The S&P 500 (SP500) on Friday posted a weekly loss of 4.65%, closing in the red for the second straight week, after the Federal Reserve’s third big rate hike in a row. The index posted losses in four out of five sessions this week.
The decline was led by energy stocks, which fell after WTI crude oil slid below $80/bbl for the first time since Jan.
The Fed raised its key lending rate by 75 bps to 3-3.25% as the central bank struggles to tame inflation. Investors appeared concerned that policymakers would be unable to engineer a soft landing as they plan more rate hikes. Most Fed officials expect the rate to top 4% by 2022-end, with further hikes expected in 2023, according to the central bank’s dot plot.
Soon after the Fed’s move, the Bank of England raised its key rate by 50 bps to 2.25%, while the Swiss National Bank raised its benchmark rate by 75 bps to 0.5%. Meanwhile, the Bank of Japan kept its key rate at -0.1% and Turkey’s central bank unexpectedly slashed its key rate by 100 bps to 12%.
The SPDR S&P 500 Trust ETF (NYSEARCA:SPY) on Friday fell 4.57% for the week alongside the benchmark index. The ETF is -22.53 YTD.
All 11 sectors in the S&P 500 closed in the red for the week, led by energy stocks. See below a breakdown of the weekly performance of the sectors as well as the performance of their accompanying SPDR Select Sector ETFs from Sept. 16 close to Sept. 23 close:
#1: Energy -9%, and the Energy Select Sector SPDR ETF (XLE) -10.15%.
#2: Consumer Discretionary -7.02%, and the Consumer Discretionary Select Sector SPDR ETF (XLY) -7.29%.
#3: Real Estate -6.44%, and the Real Estate Select Sector SPDR ETF (XLRE) -7.16%.
#4: Materials -5.67%, and the Materials Select Sector SPDR ETF (XLB) -6.13%.
#5: Financials -5.58%, and the Financial Select Sector SPDR ETF (XLF) -6.08%.
#6: Communication Services -5.1%, and the Communication Services Select Sector SPDR Fund (XLC) -5.81%.
#7: Industrials -4.55%, and the Industrial Select Sector SPDR ETF (XLI) -5%.
#8: Information Technology -3.59%, and the Technology Select Sector SPDR ETF (XLK) -3.86%.
#9: Health Care -3.38%, and the Health Care Select Sector SPDR ETF (XLV) -3.7%.
#10: Utilities -3.05%, and the Utilities Select Sector SPDR ETF (XLU) -3.64%.
#11: Consumer Staples -2.15%, and the Consumer Staples Select Sector SPDR ETF (XLP) -2.73%.
Below is a chart of the 11 sectors’ YTD performance and how they fared against the S&P 500. For investors looking into the future of what’s happening, take a look at the Seeking Alpha Catalyst Watch to see next week’s breakdown of actionable events that stand out.