US stocks pull back after Fed rate hike

New York, Dec 18 (IANS) US stocks snapped a three-day winning streak to end sharply lower on Thursday, as investors assessed the impacts of US Federal Reserve’s first rate hike in nearly a decade.

The Dow Jones Industrial Average dropped 253.25 points, or 1.43 percent, to 17,495.84, Xinhua reported.

The S&P 500 tumbled 31.18 points, or 1.50 percent, to 2,041.89. The Nasdaq Composite Index lost 68.58 points, or 1.35 percent, to 5,002.55.

The US central bank on Wednesday announced raising benchmark interest rate by 25 basis points, the first rate hike since 2006, marking the end of an era of extraordinary easing monetary policies.

US Fed Chair Janet Yellen said that policies would remain accommodative and the significance of the first hike should not be overblown.

US stocks surged on Wednesday following the Fed’s announcement, as investors thought the decision to raise rates is a vote of confidence in the US economy.

Analysts believed the stock markets would witness some volatility in recent days as Wall Street tries to digest the rate hike decision.

On the economic front, in the week ending December 12, the advance figure for seasonally adjusted initial jobless claims was 271,000, a decrease of 11,000 from the previous week’s unrevised level of 282,000, said the US Labour Department on Thursday.

The four-week moving average was 270,500, little changed from the previous week’s unrevised average of 270,750.

Overseas stock markets saw broadly-based rallies on Thursday. European equities posted solid gains following the US Fed’s rate hike decision, with Germany’s benchmark DAX index at the Frankfurt Stock Exchange soaring 2.57 percent.

In Asia, Chinese shares ended notably higher on Thursday on improved market sentiment, with the benchmark Shanghai Composite Index jumping 1.81 percent to end at 3,580 points.

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