Why Uber And Lyft Shares Are Diving

Uber Technologies Inc UBER and LYFT Inc LYFT shares are trading lower by 4.59% to $29.07 and 6.18% to $14.96, respectively, Thursday morning amid possible recession fears, which could cause consumers to cut back on non-essential spending.

Uber and Lyft shares may also be trading lower in possible reaction to Wednesday comments from Fed Chair Powell suggesting there could be a period of lower economic growth and as the broader market reacts to the Fed's decision to hike rates by 75 bps. An economic slowdown could drive consumers to cut back on discretionary spending.

What Happened?

The Federal Reserve raised its target fed funds rate by 0.75% on Wednesday to a new range of between 3% and 3.25%, its third 0.75% rate hike in four months. The Fed said it will continue with its previously announced plan to let Treasury securities and agency debt and agency mortgage-backed securities roll off its balance sheet on a monthly basis.

“Inflation remains elevated, reflecting supply and demand imbalances related to the pandemic, higher food and energy prices, and broader price pressures,” the Fed said in a statement...Read More

See Also: Federal Reserve Issues Third Straight 0.75% Interest Rate Hike: What It Means For The Struggling Stock Market