Stock Market Today: Dow slumps as rising Treasury yields rattle markets
Investing.com — The Dow slumped Thursday, pressured by rising Treasury yields as investors continued to digest the prospect of a higher-for-longer Federal Reserve interest rate regime following data showing the labor market remains tight.
The Dow Jones Industrial Average fell 1.1%, 370 points, Nasdaq fell 1.8%, and the S&P 500 fell 1.6%,
Treasury yields continued to advance after fewer than expected weekly initial jobless claims flagged ongoing strength in the labor market and the potential for a pick up inflation.
Initial jobless claims fell to 201,000 in the week ended Sept. 16 from 221,000 in the prior week, marking lowest level of claims since January.
A still-strong labor market added to fears that the Fed may have to do more to quell inflation — just a day after the Fed delivered a «hawkish pause» — sending the 10-year yield to highest level since 2006.
Big tech added to losses from a day earlier as ongoing climb in Treasury yields on expectations for the Fed to keep rates higher for longer continued to weigh.
“I would argue that the recent tech rally has been driven by the idea of the Fed not being as hawkish as they have stated, but with Fed Chairman Jerome Powell doubling down [on Wednesday] to give the Fed more room, and taking two rate cuts next year off the table, these are all in the same vein to put pressure on the sector,”Johan Grahn, Head of ETF Strategy at Allianz (ETR:ALVG) told Investing.com's Yasin Ebrahim an interview on Thursday.
“I would be cautious today on the tech sector,” Grahn added.
Amazon.com Inc (NASDAQ:AMZN), down more than 4%, led the decline, following by Alphabet Inc Class A (NASDAQ:GOOGL) and Meta Platforms Inc (NASDAQ:META).
As well as rising yields, a Broadcom (NASDAQ:AVGO)-led
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