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Photo = REUTERS
On the New York Stock Exchange, the leading index fell as a result of a rebound in US Treasury yields.
On the 18th (US time) On the New York Stock Exchange (NYSE), the Dow Jones 30 industrial average closed at 32,862.30, 153.07 points (0.46%) less than in the field. battle.
The Standard & Poor’s (S&P) 500 Index fell 58.66 points (1.48%) from the battlefield to 3,915.46, while the Nasdaq index of technology stocks plunged 409.03 points (3.02%) at 13,116.17.
The market analyzed key economic indicators such as the trend in US Treasury rates and unemployment.
As the Federal Reserve (Fed and Fed) reaffirmed its long-term low interest rate policy the day before, the rise in interest rates, which appeared to decline, sharpened again within a day.
The rate on 10-year US Treasuries soared, topping 1.75% at the beginning of the market.
Even at the close of the Stock Market, it exceeded 1.7%.
The 30-year Treasury yield has also topped 2.5%, reaching the highest level since 2019, and the long-term interest rate is on a sharp rise.
Despite repeated remarks of relaxation from the Fed, market concerns about inflation have not been resolved.
The fact that the Fed has raised its growth rate and its inflation forecasts for this year is a factor that fuels concerns about inflation, which is stronger than expected.
There is still anxiety that the Fed may tighten faster if prices are to rise.
Some point out that if the Fed sticks to a modest stance, inflation expectations will rise further and market interest rates will rise accordingly.
As interest rates rose sharply, stock market anxiety also intensified, centered on tech stocks.
Rising interest rates are one factor that increases the valuation burden of overvalued tech stocks.
Apple’s stock price fell 3.4% on the day and Tesla plunged about 7%.
The Dow index, which remained strong early in the market, eventually declined as the riot over tech stocks intensified.
US indicators sent mixed signals.
The Labor Ministry announced last week that the number of unemployment insurance claims increased by 45,000 from the previous week to 770,000 (seasonal adjustment).
It was more than the 700,000 estimates compiled by The Wall Street Journal.
The recovery in the labor market has slowed down a bit.
The February leading economic index released by the conference board rose 0.2% from the previous month to 110.5.
It did not reach the market forecast of 0.3%.
On the other hand, the March manufacturing index released by the Federal Reserve Bank of Philadelphia was 51.8, the highest in about half a century since 1973.
The market forecast of 22.0 was also significantly higher.
The Philadelphia Fed index has also raised concerns about inflation.
The price and payments index for March soared to 75.9 from 54.4 in the previous month.
This is the highest since 1980.
Yon-eun explained that companies are constantly under pressure to increase production costs.
Another factor of concern is that vaccination is discontinued while the number of new corona19 infections is increasing again in Europe.
Many European countries have temporarily suspended AstraZeneca vaccination.
However, the European Medicines Agency (EMA) announced that the AstraZeneca vaccine is safe and effective, and that the efficacy of the vaccine outweighs the risk.
Italy said it would resume vaccination the day after the EMA’s announcement.
The sharp drop in international oil prices also added to market anxiety.
West Texas Crude Oil (WTI) plunged 7.1% from the battlefield on the same day due to friction between the United States and Russia.
All industries were down that day except financial stocks which were up 0.56% per industry.
Energy plummeted 4.68% and technology led fell 2.85%.
New York stock market experts diagnosed that there was a lot of anxiety over inflationary overheating.
“It’s about inflation expectations,” said Edward Park, chief investment officer at Brooks McDonald’s.
According to the Chicago Merchandise Exchange (CME) Fed Watch, the FF interest rate futures market is 25 basis points in September.
We reflect the possibility of an interest rate hike of 4.4%.
On the Chicago Options Exchange (CBOE), the volatility index (VIX) registered 21.58, 12.22% more than the previous trading day.
/ yunhap news
