Stock Market Sell-Off: 2 Top Stocks to Buy Hand Over Fist
Federal Reserve chair Jerome Powell sent the stock market packing on Friday, Aug. 26, following his comments that indicate the central bank may continue to increase interest rates in a bid to keep inflation in check.
The hawkish comments from the Fed chair caused the Dow Jones Industrial Average to tumble over a thousand points, while the S&P 500 shed 3.4% of its value. The Nasdaq Composite also slid 3.9% on Friday. Powell's comments delivered a blow to the stock market rally that has been in effect since the beginning of July. Tech stocks have been hit particularly hard by the rising interest rates as the 23% drop in the Nasdaq Composite indicates.
Richly valued tech stocks tend to underperform in a high interest rate environment as investors worry that high borrowing costs could stunt earnings growth. But savvy investors should note technology stocks have outperformed the broad market by a massive margin in recent years.
Source Fool.com
