Market Averages Fall Third Week With Rising Treasury Yields

Barry Adams
17 Aug, 2023
New York City

Activities in bonds drove the sentiment in the stock market as investors reassess Fed's next move and review rate path possibilities. 

The yield on 10-year U.S  Treasury bonds jumped to the highest level since October and hovered near 4.3% after investors assessed rates to go higher at the next Fed's meeting on September 19. 

Popular market averages have been on the downhill for the third week in a row on the rate hike worries and looming recession. 

Investors have been debating how high rates have to go and how long rates have to be high before inflation comes down to the 2% level preferred by the Federal Reserve. 

The debate has roiled stocks in the last three weeks after the market rally of nine months came to a halt as investors focused on stretched valuations and rising Treasury yields.

Jobless claims decreased 11,000 by 239,000 from the previous week's upwardly revised 250,000 claims, the Department of Labor reported Thursday in its weekly report.   

Investors also reviewed the latest earnings from several companies including Cisco and Walmart. 

 

U.S. Indexes & Yields 

The S&P 500 index traded down 0.04% to 4,402.60 and the Nasdaq Composite fell 0.5% to 13,408.40. 

The yield on 2-year Treasury notes increased to 4.97%, 10-year Treasury notes inched higher to 4.30% and 30-year Treasury bonds edged down to 4.32%. 

Crude oil increased $1.06 to $80.54 a barrel and natural gas prices increased 6 cents to $2.65 a thermal unit. 

 

U.S. Stock Movers 

Cisco Systems Inc rose 3.8% to $55.02 after the networking gear maker reported better-than-expected revenue and earnings in its latest quarter. 

Walmart Inc declined 1.4% to $156.95 despite the retailer reporting better-than-expected quarterly results. 

CVS Health Corp decreased 9.5% to $66.10 after Blue Shield of California dropped the company's pharmacy services. 

The company said it will partner with Cost Plus Drug Company and Amazon pharmacy services to save drug costs for its 5 million members.