Written by Liz Muir
Investing.com – Stocks closed lower after the Federal Reserve indicated that interest rates could rise higher than people had expected.
Everyone assumed the Fed would raise its benchmark rate another 0.75 percentage points when it closes the league today, but the announcement also included a set of forecasts that put rates on a path to a rally above 4.5% next year.
Some policy makers have indicated rates could be as high as 4.9%. Investors had expected to see a peak of 4.5% in the spring and then lower rates.
In addition, policymakers suggest that they can begin to lower prices in 2024.
Stocks have been weighed down by the realization that the Fed intends to keep interest rates higher for longer while trying to tame, and that could lead to job losses and economic pain. Expectations are for the unemployment rate to rise from the highest to 4.4% by the end of next year.
Here are three things that could affect the markets tomorrow:
1. Costco Earnings
Warehouse Club Costco Wholesale Corp (NASDAQ) announces earnings Thursday. Analysts expect earnings per share of $4.15 on revenue of $71.6 billion, and will hear what executives have to say about changes in consumer behavior.
2. Darden Earnings
Darden Restaurants Inc (NYSE) also reported earnings, with analysts expecting earnings of $1.56 on revenue of $2.47 billion. Changes in consumer behavior are also important to the restaurant business as it tries to recover from the pandemic.
3. Unemployment Claims
Data is due at 8:30 EST (12:30 GMT). Analysts expect another week low at 218,000, which could compare with 213,000 new orders the previous week.