Better-than-expected jobs data stoked fears that interest rates will stay high for longer and boosted U.S. Treasury yields.
The main Wall Street indices fall this Tuesday, October 3, due to the firmness of the rates of the US Treasury bond yieldwhich extends its rally to multi-year highs after employment data better than expected that fueled the fear that interest rates stay higher for longer.
He Dow Jones Industrial Average loses 438.78 points, or 1.3%, to 32,994.57 units; the index S&P 500 falls 64.38 points, or 1.5%, to 4,224.01 units; and the Nasdaq Composite fell 234.09 points, or 1.8%, to 13,073.68 units.
Shares of mega-cap firms were the hardest hit. The return on 10- and 30-year Treasury public debt operated at its highest level since 2007, generating Manzana, tesla, Amazon.com, Alphabet and Microsoft will drop between 0.8% and 2.5%.
After a stellar first half of the year driven by the boom in Artificial intelligence (IA), some investors believe mega-cap stocks could lose momentum as yields continue to rise.
“We are in the middle of a historic movement in the 10-year Treasury yield (…) the curve had historically inverted and, in many ways, we are catching up,” he said David Russellfrom TradeStation.
The sector of discretionary consumption led the descents of the main divisions of the S&P 500with a decline of 2.2%, while the weakened public services sector fell 1.8%.
The industrial group lost 0.2%, but the shares of Boeing -with an increase of 1.8%- helped limit the sector’s decline, after Reuters reported that United Airlines was going to announce an order for 50 aircraft Boeing 787 Dreamliner.
Wall Street: employment data boosts Treasury bonds
A Department of Labor report showed 9.61 million job vacancies in August. Investors’ attention will now focus on the ADP national employment figures and in the nonfarm payroll report For more clues about the status of the American labor market.
Source: Ambito
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