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    US stocks fall sharply as Treasury yields continue to rise

    Following the mixed performance seen in the previous session, stocks fell sharply during trading on Tuesday. The Nasdaq and S & P 500 fell to their lowest closing prices in one and two months, respectively, due to the plunge that day.

    All major averages ended the day firmly in the negative territory. The Dow fell 569.38 points (1.6%) to 34,299.99, the Nasdaq fell 423.29 points (2.8%) to 14,546.68, and the S & P 500 fell 90.48 points (2%) to 4,352.63.

    Technology stocks helped guide a significant downturn on the day amid continued rises in government bond yields.

    Benchmark 10-year bond yields reached their highest levels in more than three months, extending the upward movement seen since the announcement of the Federal Reserve Board last week.

    The rise in financial yields, which moves in the opposite direction to bond prices, is due to the Fed’s plans to begin curtailing asset purchases in the near future.

    Also contributing to continued progress in yields, Federal Reserve Board Chair Jerome Powell warned members of the Senate Banking Commission during his testimony this morning about the upside risks to inflation.

    In a prepared statement, Powell predicted that inflation would remain on the rise for the next few months before it eased.

    “As Economy Resumptions and recovery in spending continue, putting upward pressure on prices, especially due to supply bottlenecks in some sectors. “

    “These effects are greater than expected and lasting, but will weaken, and inflation is expected to fall towards the long-term 2% target,” he added.

    Powell warned that as the economy continued to reopen, supply bottlenecks, employment difficulties and other constraints could increase and pose an upward risk to inflation.

    “If sustained high inflation becomes a serious concern, we will ensure that we respond and use tools to ensure that inflation is carried out at a level that is in line with our goals,” said the Fed’s chief. Said.

    In addition to negative sentiment towards Wall Street, the Conference Board unexpectedly released a report in September showing the continued deterioration of US consumer confidence.

    The Conference Board said the Consumer Confidence Index fell from 115.2, which was revised upward in August, to 109.3 in September.

    This decline surprised economists who expected the index to rise from 113.8, which was first reported last month, to 114.8.

    Sector news

    Semiconductor stocks fell sharply on the day, and the Philadelphia Semiconductor Index fell 3.8%, the lowest closing price in more than a month.

    Software stocks also saw significant weaknesses, as reflected in the 3.7 downturn in the Dow Jones US Software Index. The index ended the session at a two-month low.

    Biotechnology stocks also showed considerable weakness, with the NYSE Arca Biotechnology Index down 2.6%.

    Inventories of housing, steel and computer hardware also showed a striking move to decline, reflecting Wall Street’s widespread weaknesses.

    Other markets

    In overseas transactions, stocks market During the trading on Tuesday, various performances were seen throughout the Asia Pacific region. Japan’s Nikkei 225 Index fell 0.2%, while China’s Shanghai Composite Index rose 0.5%.

    Meanwhile, all major European markets have moved down that day. The UK’s FTSE 100 index fell 0.5%, while the German DAX index and the French CAC 40 index fell 2.1% and 2.2%, respectively.

    In the bond market, government bonds were below their worst levels, but were still tightly closed in the negative territory. As a result, benchmark 10-year bond yields, which move against prices, rose 5 basis points to a three-month high of 1.534%.

    Future outlook

    A report on pending home sales may draw attention on Wednesday with more remarks by Fed officials, including Powell.

    Contact for comments and feedback: editorial@rttnews.com

    Business news

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    US stocks fall sharply as Treasury yields continue to rise

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    The post US stocks fall sharply as Treasury yields continue to rise appeared first on Eminetra.

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