Stocks Fail To Recover From Fed-Fuelled Selloff: Markets Wrap

US stocks ended a choppy session with modest losses, struggling to rebound from the selloff they suffered after the Federal Reserve dialled back rate-cut expectations for next year. 

Earlier, the Bank of England kept borrowing costs unchanged at 4.75%. Still, money markets now see two quarter-point reductions and a strong chance of a third in 2025 after three of the nine-member policy committee called for a cut at Thursday’s meeting. Swap traders had priced in less than two reductions next year prior to the announcement. 

The pound declined.

The yen weakened after comments by BOJ Governor Kazuo Ueda cast doubt on whether the bank could hike interest rates in January. 

In China, authorities ramped up support for the currency via its daily reference rate after the Fed’s caution over future rate cuts sent the offshore yuan to a fresh one-year low.

In commodities, oil fell by almost 1% after the Fed’s outlook for next year boosted the dollar.