The Dow Jones industrial average and the broader S&P 500 traded lower on Monday, with the latter completing five consecutive negative sessions, while the tech Nasdaq managed with an impressive counterattack in the end to regain the positive sign, albeit at a low level. of the day was found to dive 2.7%.
Nervousness in the US market is fueled by the impressive rally in bond yields as investors wait for the Federal Reserve to react to the spike in inflation even with four rate hikes this year.
The 10-year yield in the US climbed earlier today to 1.8% having closed in 2021 close to 1.51%. The 10-year yield has completed seven days of ascent, the largest uptrend since April 2018, climbing to 1.808% which is the highest level since January 2020.
The rally in yields comes in anticipation of the data that will be announced on Wednesday for inflation. Consumer prices have already jumped to 6.8% which is the highest level in the last 40 years or so.
The jump in inflation led Goldman Sachs analysts to estimate for four interest rate hikes by the Federal Reserve this year, instead of the three previously expected. Analysts at JP Morgan and Deutsche Bank are also expecting four increases.
Indicators – Statistics
On the board, the industrial Dow Jones lost 162.79 points or -0.45% and closed at 36,068.87 points, while at the bottom of the day it was found to fall more than 500 points.
The broader S&P 500 fell 6.74 points or -0.14% to 4,670.29 points, while the Nasdaq gained 6.93 points or 0.05% to 14,942.83 points.
Of the 30 stocks that make up the Dow Jones industrial average, 13 closed with a positive sign and 17 with a negative. The biggest gains were made by Intel with gains of $ 1.77 or 3.31% at $ 55.21, followed by Merck at $ 82.37 with gains of 2.58% and UnitedHealth Group at $ 465.00. with an increase of 1.40%.
The three stocks with the biggest losses are Nike (-4.16%), Boeing (-2.87%) and Visa (-2.30%).
Investors are awaiting statements from Fed Chairman Jerome Powell to the Senate Banking Committee on Tuesday as part of a hearing to approve his reshuffle at the helm of the central bank.
The head of the Fed is expected to face a barrage of questions from senators on how the Fed plans to deal with the inflation rally, while not derailing the recovery of the US economy.
Most investors are now waiting for the Fed to start raising interest rates in March, two years after reducing them to near zero in the outbreak of the pandemic in March 2020.
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