Wall St slips on higher yields, fall in chipmaker stocks
By Caroline Valetkevitch
NEW YORK (Reuters) — U.S. stocks were slightly lower in afternoon trading on Tuesday as Treasury yields rose and shares of chipmakers fell after the Biden administration said it planned to halt shipments of advanced artificial intelligence chips to China.
The Philadelphia SE Semiconductor index was down 1.1% and shares of Nvidia (NASDAQ:NVDA) were down 4.7% even though the world's most valuable chipmaker said it does not expect a near-term meaningful impact on financial results from the curbs.
U.S. Treasury yields rose on robust economic data. Higher yields dull the allure of stocks by offering investors comparatively high income on risk-free government bonds.
Helping to limit the declines, though, were upbeat earnings reports from companies including Bank of America, whose stock was up 2.3% following its quarterly results.
«We had some pretty good earnings from most of the major companies reporting today… but the indices are running up a brick wall as yields go higher,» said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
The Dow Jones Industrial Average fell 67.92 points, or 0.2%, to 33,916.62, the S&P 500 lost 8.67 points, or 0.20%, to 4,364.96 and the Nasdaq Composite dropped 46.54 points, or 0.34%, to 13,521.44.
Investors also are still anxiously watching news on the Middle East. U.S. President Joe Biden is set to visit Israel on Wednesday, after Washington said Prime Minister Benjamin Netanyahu had agreed to allow humanitarian aid to reach Gazans.
Data earlier showed U.S. retail sales rose 0.7% in September, compared with estimates of a 0.3% rise, while a separate reading showed production at U.S. factories increased more than expected in September.
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