Stocks fell on Friday as Wall Street’s summer rally appeared to falter and fears of rising rates resurfaced, putting the major averages on pace to potentially end the week on a sour note.
The S&P 500 fell 1.2%, while the Dow Jones Industrial Average fell 291 points, or 0.85%. The Nasdaq Composite fell 1.9%.
For the week, the S&P 500 was down 1.1%, while the Dow was slightly higher. The tech-heavy Nasdaq is currently down more than 2.5% for the week.
The shutdown of Wall Street’s summer rally came as the minutes of the Federal Reserve’s July meeting and comments by the chairman of the Federal Reserve in St. Louis, James Bullard indicated that the central bank would likely continue to raise rates in the short term, dampening investors’ hopes of a slowdown.
Not everyone is convinced that this week’s moves spell the end of the market’s recent rally.
“I wouldn’t expect a full reversal going back to the June lows or anything like that, but the jitters we’re seeing today and this week reflect a lot of the bear case that’s out there,” FBB Capital Partners said. Mike Bailey. “I think seeing the market trade sideways or seeing a bit of a pause in this rally definitely makes sense based on some of the facts that we’re seeing.”
In other news, shares of Bed Bath & Beyond soared after Ryan Cohen dumped his entire stake in the retailer. The move appeared to hurt sentiment among the same stock traders who have bet heavily on the stock in recent months.
Meanwhile, options contracts with a notional value of $2 trillion expire on Friday, which could lead to more volatility in the market as some holders may be forced to move their positions.