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U.S. Stocks Sell Off on Fed Rate Fears as Dow, S&P 500 Head for Two-Month Low

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U.S. stocks were in sell-off mode on Friday as renewed fears about the chance of a Federal Reserve interest-rate hike this month weighed. The Dow Jones Industrial Average was poised to close at the lowest level in two months, shedding more than 300 points as all of its blue chips declined amid steep losses in Verizon ( VZ ), Boeing ( BA ) and Caterpillar ( CAT ). The S&P 500 was set for the lowest close since July 8.

The CME Group's FedWatch tool reflected a 24% probability of a hike, up from 18% on Thursday. That followed comments by Boston Fed President Eric Rosengren that the low interest rate environment increases the likelihood for the economy to "overheat," and he sees a gradual policy tightening as appropriate. All 10 of the S&P 500's sectors were retreating, with telecommunications services losing 3.3% and utilities down 3.2%.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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