U.S. stocks tumbled on Monday as oil prices kept rising and Treasury yields reached their highest points since the summer.
S&P 500
Despite a 1 per cent decline, the S&P 500 is still quite near to the record high it reached a week ago. The S&P 500 saw a declining opening compared to closing level of 5,751.07 points from previous trading day.
The S&P 500 rode slow turtle and traded with a negative sentiment, eventually leading the index into a negative closing, still very close to the life level from a week ago.
The mute opening went on to touch the day-low of 5,686.85 points before the index shed about 0.96 per cent, amounting to 55.13 points in total from the index closing at 5,695.94 points on the US bourse.
The Nasdaq Composite
The Nasdaq composite was suffering from the weight of the giants from the tech pack, including the magnificent seven companies, including chip giant Nvidia and smartphone giant Apple, The Nasdaq Composite was ready dive as soon as the market hit the opening bell.
After the opening bell at 18,080.12, the index was already lost 109.07 points trading at 18.028.28 points; eventually, the tech-heavy index went to touch the day low of 17,900.04 points.
The Nasdaq Composite concluded yesterday’s trading session at 17,923.90 points, After showing a negative sentiment over the rising oil prices and armed confrontation between Israel and Iran, the index lost about 213.95 points, amounting to 1.2 per cent.
Dow Jones Industrial Average
The Dow Jones Industrial Average dropped 398 points, amounting to 0.94 per cent. The opening bell on index saw a sharp decline from 42,289.51 to 42,156.47 in under 10 minutes after opening bell.
The index went on to touch the day-low level of 41,837.86 points in the later half of the trading session. The Dow Jones Industrial Average shuttered at 41,954.24 points, dipping 0.94 per cent, amounting to 398.51 points.
The boil in Oil
The global benchmark, Brent crude, increased by an additional 3.7 per cent on Monday, closing at USD 80.93 per barrel. In the meantime, benchmark US oil increased 3.7 per cent to USD 77.14 per barrel.
Higher Treasury yields can put the most downward pressure on the most expensive stocks, and Big Tech stocks have been the focus of attention lately. They rose to levels that detractors deemed excessive and accounted for the lion's share of the S&P 500's recent returns.
Among the S&P 500's heavyweights on Monday were Apple, which fell 2.3 per cent, Amazon, which fell 3 per cent, and Alphabet, which fell 2.4 per cent.
Interest rate cut from federal reserve
After U.S. stocks surged to all-time highs on relief that interest rates are finally starting to decline, the market is stagnating now that the Federal Reserve is shifting its emphasis from merely combating excessive inflation to maintaining a healthy economy.
The shocking report on U.S. job growth released on Friday increased confidence in the economy and expectations that the Fed will be able to execute a flawless turnaround.
However, the strength of Friday's jobs report also compelled traders to lower their expectations for the final amount of interest rate cuts by the Fed. That in turn has sent Treasury yields higher, and the 10-year yield is back above 4 per cent for the first time since August.
