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Post: Market Snapshot: Dow futures drop 240 points as stocks selloff looks set to continue

U.S. stock futures pointed to fresh losses for Wall Street on Monday as Federal Reserve Chairman Jerome Powell’s hawkish commentary from Jackson Hole, Wyo. continued to reverberate.

What’s happening
  • S&P 500 futures

    slid 33 points, or 0.8%, to 4,026.50.

  • Dow Jones Industrial Average futures

    dropped 240 points, or 0.7%, to 32,021

  • Nasdaq-100 futures

    fell 117 points, or 0.9%, to 12,504.

Stocks recorded their worst day in months on Friday, when the Dow industrials

tumbled 1,008.38 points, or 3%, to close at 32,283.40, its biggest percentage decline since May 18. The S&P 500

slid 3.4% to 4,057.66, its biggest drop since June 13, and the Nasdaq Composite

tumbled 3.9%, to close at 12,141.71, the largest drop since June 16.

What’s driving markets?

Both bonds and stocks appear to have been shaken by Powell, who made blunt comments about the central bank’s commitment to bringing down high inflation on Friday during a speech at the Kansas City Fed’s annual symposium at Jackson Hole, Wyo.

Powell said the Fed would continue the fight even if it means pain for American families and businesses. His comments seemed to and dash hopes for a pivot toward less aggressive rate hikes.

Read: Stock futures plunge Sunday evening as investors react to Fed comments

“Reducing inflation is likely to require a sustained period of below-trend growth,” Powell said. “While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses.”

Powell also mentioned a resilient jobs market, suggesting that he is willing to allow unemployment to climb, noted Ipek Ozkardeskaya, senior analyst at Swissquote Bank, in a note to clients.

That means another strong print on the state of jobs growth in August could help strengthen the Fed’s resolve.

“Due Friday, the NFP data is expected to print another month close to 300,000 new nonfarm job additions in the U.S. Over the past four months, the data clearly exceeded the market expectations, especially last month, the number printed was above half-a-million new job additions, versus around 250,000 expected by analysts,” said Ozkardeskaya.

Even if the data were to come in short of economists’ expectations, investors shouldn’t expect to see any change in the Fed’s outlook. Instead, “from now on, we expect to see a deeper downside correction in equities, and further retracement of the summer rally.”

As the selloff in bonds gathered pace, the 2-year Treasury

yield climbed 5 basis points to 3.453%, a level not seen since November 2007.

Companies in focus
  • Tesla Inc.

    Chief Executive Elon Musk said Monday he is aiming to get the electric-vehicle maker’s self-driving technology ready by year-end, and said he hopes it could quickly be in wide release in the U.S. and even Europe depending on regulatory approval, Reuters reported. Shares were down 2% in premarket trade.

Other assets
  • The Fed’s hawkish tone boosted the dollar, with the ICE U.S. Dollar Index DXY up 0.2% to 109.03 while also briefly topping 139 yen USDJPY, just shy of the highest level against the Japanese currency in 24 years.

  • Oil futures moved higher, with the U.S. benchmark

    up 0.5% near $93.60 a barrel, while gold

    fell 0.4% to trade near $1,743 an ounce.

  • Bitcoin

    rose 1.3% to trade near $19,900.

  • The Stoxx Europe 600

    was down 1%, while London markets were closed for the summer bank holiday.

  • The Shanghai Composite

    ended 0.1% higher, while the Hang Seng Index

    fell 0.7% in Hong Kong and Japan’s Nikkei 225

    dropped 2.7%.

Hear from Carl Icahn at the Best New Ideas in Money Festival on Sept. 21 and Sept. 22 in New York. The legendary trader will reveal his view on this year’s wild market ride.

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