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Fed delivers first 50 basis point rate hike in 22 years
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QT to begin in June at pace of $47.5 billion per month
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Fed is not actively considering 75 basis point rate hikes
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USD drops, gold gains after Powell's presser
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EU inching closer to embargo on Russian oil, crude jumps 5%
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European indices finish trading lower
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ADP employment report shows 247k jobs gain in April (exp. 395k)
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ISM services employment subindex drops into recession territory in April
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Lyft and Uber Technologies drop after Q1 earnings disappoint
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AMD gains as management remains bullish on PC demand
FOMC meeting was a key point in today's and this week's economic calendar. As expected, the US central bank delivered the first 50 basis point rate hike in 22 years and announced the beginning of quantitative tightening. Balance sheet run-off will begin in June at a monthly pace of $47.5 billion and increase to $95 billion after 3 months. Fed Chair Powell explained during the press conference that US central bankers are not actively considering a possibility of a 75 basis point rate hike but 50 basis point rate hikes are on table for the next couple of meetings.
The EU embargo on Russian oil was a big story of the day as well. While European Union members failed to agree on the definite shape of oil sanctions, decision may come this or next week. Embargo is expected to be gradual with some countries exempted from it. However, what looks massive is that it will target not only oil imports but also provide services to the Russian oil shipping sector, like for example maintenance or insurance. As Russia relies on foreing tanker fleet to ship its oil overseas, such measures may have a negative impact on Russian oil exports even beyond those to the EU. Both Brent and WTI gained more than 5% today.
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Nasdaq-100 (US100) continues recovery with help from Fed. Both a policy decision and Powell's presser were seen as less hawkish than expected. Source: xStation5
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