Fed rate hike sends stocks lower, yields higher
Transportation stocks fell, with the Dow Jones Transportation Average down more than 2% and J.B. Hunt plunging over 13% after warning of weaker third-quarter earnings.
Advisers recalibrate for “higher for longer”
The 12-0 vote marked a shift from July, when the committee held rates steady in a 9-3 split, Yahoo Finance reported. David Krakauer, vice president of portfolio management at Mercer Advisors, said the change in tone was significant. “A unanimous hike materially raises the probability of another move before year-end,” Krakauer said.
Daniel Siluk, portfolio manager and head of global short duration and liquidity at Janus Henderson, said the decision addressed doubts about the central bank’s resolve. “Today’s decision reduces the risk that investors question the Fed’s inflation-fighting resolve,” Siluk said, according to InvestmentNews.
UBS Wealth Management USA raised its 2026 forecast to two rate hikes earlier this month, anticipating moves in September and December, TheStreet reported. UBS executive director and senior US economist Andrew Dubinsky said in a Sept. 7 note that a more hawkish Fed does not necessarily signal a weaker investment outlook, according to TheStreet.
The 30-year fixed mortgage rate rose to 7.24%, its highest level since Jan. 14, 2025, according to Mortgage News Daily data.
