Stock market today: Wall Street steadies after selloff as a relaxing bond market offers some oxygen
Wall Street is holding steadier after the bond market relaxed its vise a bit on the stock market
NEW YORK — Wall Street is holding steadier Wednesday after the bond market relaxed its vise a bit on the stock market.
The S&P 500 was 0.4% higher in early trading, coming off a 1.4% tumble that had sent it to its lowest level in four months. The Dow Jones Industrial Average added 51 points, or 0.2%, a day after wiping out its gains for the year so far. The Nasdaq composite was 0.7% higher, as of 9:40 a.m. Eastern time.
Stocks have struggled since the end of July as Treasury yields in the bond market soar to their highest levels in more than a decade. The high yields undercut stock prices by pulling investment dollars away from stocks and into bonds. They also crimp corporate profits by making borrowing more expensive.
The yield on the 10-year Treasury, which is the centerpiece of the bond market, pulled back from its highest level since 2007, down to 4.74% from 4.80% late Tuesday. Shorter- and longer-term yields also eased to offer more oxygen to the stock market.
Yields fell after a report indicated hiring by employers outside the government was weaker last month than expected. On Wall Street currently, the hope is for a cooling job market because that may mean less upward pressure on inflation. That in turn could convince the Federal Reserve to take it easier on interest rates.
The Fed has hiked its main interest rate to the highest level since 2001 and indicated it will keep rates higher next year than it had earlier expected. Traders on Wall Street have been coming around to the Fed’s predictions that it will keep rates high for longer, which is why Treasury yields have snapped so much higher.
The Fed is paying
Read more on abcnews.go.com
