Market Volatility Rises Sharply After Powell's Speech

U.S. stocks dropped sharply on Friday following comments from Federal Reserve Chief Jerome Powell.

Powell said the Fed will remain aggressive in its monetary policy stance to fight inflation. “Price stability is the responsibility of the Federal Reserve and serves as the bedrock of our economy,” Powell said. “Without price stability, the economy does not work for anyone.”

The Nasdaq recorded its worst single-day performance since June 16, amid a decline in high-growth tech shares. Shares of Apple Inc AAPL dropped around 3.8%, while Amazon.com, Inc AMZN fell about 4.8% in the previous session.

The Nasdaq 100 dipped 4.10% to close at 12,605.17 on Friday, while the S&P 500 fell 3.37%. The Dow Jones tumbled around 1,008 points to settle at 32,283.40 in the previous session.

All the major sectors on the S&P 500 closed on a lower note, with information technology and consumer discretionary stocks recording the biggest plunge on Friday.

The Chicago Board Options Exchange's CBOE Volatility Index (VIX) jumped 17.4% to 25.56 points on Friday, notching its highest finish in six weeks.

What is CBOE Volatility Index?

The CBOE Volatility Index, popularly known as VIX, is a measure of the equity market's expectation of volatility based on S&P 500 index call and put options.