The Impending Challenge: Surging U.S. Dollar Threatens Stock-Market Bulls

Analysts are warning that the surge in the U.S. dollar may pose a problem for U.S. stocks as they struggle through a losing September. A stronger dollar makes goods more expensive for overseas buyers and reduces the value of income earned overseas on income statements. The U.S. dollar has strengthened rapidly in response to the Federal Reserve's interest rate hikes, and this could negatively impact U.S. multinationals. The rising dollar also tightens financial conditions, adding to other headwinds for stocks heading into the fourth quarter.