U.S. Stock Futures Are Lower While the Fed Raised Its Benchmark Rate

United Asset Strategies |

U.S. stock futures are lower:  The Fed raised its benchmark rate by a 50 bps, as expected, to a target range between 0.75% and 1% and will begin shrinking Treasury and mortgage-backed securities in June at an initial combined pace of $47.5B and increasing to $95B over three months.  Chairman Powell eased market concerns of an aggressive 75 bps shift and reiterated a measured path to mitigate inflationary pressures.  A relief rally occurred post press conference and subsequently markets closed up sharply.   Jobless claims from last week was 200k compared to 178k consensus. Labor productivity declined 7.5% in the 1Q’22 compared to consensus -2.5% and unit labor costs increased annually 11.6% relative to 6.8% estimate.  Treasury yields are holding steady post economic announcements.  OPEC+ announced raising production target to 432,000 barrels per day for the next month and will gradually increase output targets.   European markets are trading higher as the Bank of England’s Monetary Policy Committee approved a 25-basis point increase by a majority of 6-3, taking the base interest rate up to 1%.  Asian markets closed lower