S&P 500, Nasdaq Indexes Near One Year Highs, Treasury Yields Advanced After Rate Hike Worries Resurfaced

Barry Adams
19 May, 2023
New York City

Stocks traded higher for the third day in a row and market indexes are set to extend weekly gains. 

Benchmark indexes extended weekly gains between 2% and 3% on the optimism that debt limit talks could be concluded as early as this weekend, paving the way for the lawmakers to approve the agreement next week. 

The Nasdaq index is trading near one-year high and the S&P 500 index is hovering at a 9-month high. European markets also traded at new record highs and the Nikkei index in Tokyo closed at a 33-year high. 

Financial markets have been on edge for two weeks on the worries that the U.S. Treasury may default on or after June 1 its debt obligation if the $31.4 trillion debt ceiling is not lifted. 

Talks of U.S. default had kept investors on edge and global markets in check amid the uncertainties. 

In addition, rate hike worries resurfaced after a chorus of Fed officials stressed that the current economic data do not support a case for rate hike. 

The yield on 2-year and 10-year Treasury notes jumped to highs not seen in two months on the expectation that rates may be revised higher at the next meeting on June 13-14.   

 

U.S. Indexes & Yields 

The S&P 500 index increased 0.2% to 4,207.69 and the Nasdaq Composite added 0.1% to 12,708.63. 

The yield on 2-year Treasury notes increased to 4.32%, 10-year Treasury notes edged up to 3.70% and 30-year Treasury bonds held at 3.95%. 

Crude oil rose $0.68 to $72.54 a barrel and natural gas prices rose 6 cents to $2.65 a thermal unit. 

 

U.S. Stock Movers 

Foot Locker Inc plunged 24.1% to $24.55 after the specialty  retailer reported weaker-than-expected sales and earnings in the first quarter. 

The athleticwear maker reported first quarter revenue of $1.93 billion and adjusted earnings per share of 70 cents. 

Deere & Company increased 3.3% to $382.83 after the agriculture equipment maker reported better-than-expected quarterly results. 

The Children's Place Inc declined 5.8% to $23.20 ahead of the specialty apparel retailer's first quarter results next week. 

Farfetch Ltd soared 26.1% to $5.46 after the online fashion platform reported higher-than-expected quarterly results. 

Revenue in the first quarter increased 8% to $476.2 million from $435.9 million and the company swung to a profit of $728.8 million from a loss of $174.3 million and diluted loss per share shrank to 37 cents from 43 cents a year ago. 

Applied Materials, Inc fell 2.7% to $126.36 after the semiconductor equipment maker reported mixed quarterly results. 

Revenue in the fiscal second quarter ending in April increased 6% to $6.6 billion and gross margin of 46.7%. 

Net income increased 3% to $1.57 billion from $1.53 billion and diluted earnings per share increased to $1.84 from $1.74 a year ago.