Nasdaq 1.8% ↓ … Strong US Interest Rate Weaken Stock Market
The New York Stock Exchange(NYSE) plunged due to the impact of the US Treasury bond yield, which recorded record highs for the day before. The Nasdaq fell sharply to nearly 2 percent. US economic indicators have been on the rise, raising concern about inflation.
The Dow Jones industrial average fell 200.91, or 0.75 percent, to 20,627.48. The Standard & Poor’s(S&P) 500 index closed at 2901.61, falling 23.90 pct (0.82 percent). The Nasdaq composite fell 145.58, or 1.81 percent, closed at 7879.51.
Nine of the 11 S&P 500 sectors fell. Tech sector, discretionary consumer goods sector and communication service sector decreased by 1.78%, 1.60% and 1.48% respectively. On the other hand, the financial sector was up 0.71%.
The 10-year US Treasury yield rose to 3.232 percent, the highest level in seven years. The number of new unemployment benefits filed last week was close to a minimum in 49 years. Now the market interest has moved to the US Department of Labor’s September employment report, which will be announced the next day.
In the New York stock market, the financial sector showed a strong performance. In particular, the upswing in banking stocks has been remarkable. If sovereign bond yields rise, banks tend to benefit from them.
Market participants are expected to pay attention to the US Department of Labor’s September employment report, which is due to be released the following day. In particular, attention is focused on whether there will be signs of rising wages. Earlier, Amazon said it would raise the minimum wage for US workers to $ 15 per hour starting November 1.
Although the day ended in a downtrend, the New York Stock Exchange’s three major indexes are still at record high levels. Concerns are mounting over the stock valuation, as the upcoming earnings season is imminent.