The US markets extended their previous session’s losses and ended at their lowest closing levels in two months on Friday amid a steep drop by shares of FedEx (FDX). The delivery giant plunged by 21.4 percent to a two-year closing low. The sell-off by FedEx came after the company reported weaker than expected preliminary fiscal first quarter results and withdrew its full-year guidance. FedEx cited global volume softness and expectations for a continued volatile operating environment and warned it expects business conditions to further weaken in the second quarter. The warning from FedEx added to concerns about the outlook for the global economy amid monetary policy tightening by central banks around the world.
Concerns about the outlook for interest rates also continued to weigh on the markets ahead of the Federal Reserve's monetary policy decision next week. The Fed is widely expected to raise interest rates by another 75 basis points, although some see an outside chance for a 100 basis point rate hike. Meanwhile, traders largely shrugged off a report from the University of Michigan showing a modest improvement in consumer sentiment and a decrease in inflation expectations. The University of Michigan said its consumer sentiment index inched up to 59.5 in September from 58.2 in August. With the uptick, the consumer sentiment index reached its highest level since hitting 65.2 in April.
Dow Jones Industrial Average fell 139.40 points or 0.45 percent to 30,822.42, Nasdaq dropped 103.95 points or 0.90 percent to 11,448.40 and S&P 500 was down by 28.02 points 0.72 percent to 3,873.33.
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