Rising bond yields sink US stocks
The S&P 500 fell 0.7% on Wednesday as rising government bond yields weighed on the stock market.
10-year Treasury yields have risen 15 basis points over the past two sessions, though market pricing for how many interest rate cuts the Federal Reserve will deliver before year-end hasn’t changed. This lends credence to the argument that the supply of Treasuries hitting the market this week — which have been received fairly poorly at auctions — is contributing to the upward pressure on yields. The iShares 20+ Year Treasury Bond ETF has suffered back-to-back daily losses of more than 1% for the first time since early February.
Though Nvidia finished up 0.8%, it couldn’t save the US stock market for a second straight day. Poor breadth continued to bedevil the stock market, with nearly 8 stocks in the S&P 500 down for every one that was up. All 11 S&P 500 sector exchange-traded funds ended in the red, with energy, materials, industrials, and utilities suffering losses of more than 1%.
American Airlines Group was a standout to the downside, falling 13.5% after the company cut its earnings outlook for the current quarter and announced that its chief commercial officer was leaving the company.
