(New York = Yonhap News) Correspondent Oh Jin-woo of Yonhap Infomax = In the New York stock market, major indexes ended in mixed tax after showing great volatility in connection with the fluctuations in US Treasury yields.
On the 26th (US time) on the New York Stock Exchange (NYSE), the Dow Jones 30 Industrial Average closed at 30,932.37, down 469.64 points (1.5%) from the battlefield.
The Standard & Poor’s (S&P) 500 index closed at 3,811.15, down 18.19 points (0.48%) from the battlefield, but the technology stock-oriented NASDAQ index closed at 13,192.34, up 72.91 points (0.56%).
The Dow index fell by 1.8% this week. The S&P500 index fell by about 2.5% and the NASDAQ fell by 4.9%.
The market watched the US interest rate trend, major economic indicators, and news related to stimulus measures.
As the US 10-year Treasury bond yield has risen sharply, recently surpassing 1.5%, the stock market’s uncertainty has also increased.
The rapid rise in interest rates raises the valuation burden for high-value technology stocks. In addition, as interest rates on government bonds, which are risk-free assets, exceed the dividend yield of the S&P 500 index, the attractiveness of stock investment compared to government bonds has also halved.
The rise in interest rates reflects expectations for economic recovery, but there are great concerns that the rate of growth is too steep. As a result, the negative side of rising interest rates has been further highlighted.
Even on this day, major indexes showed an unstable trend, with fluctuations and fluctuations in the interest rate trend.
The 10-year U.S. Treasury bond yield exceeded 1.52% at the beginning of the market and then fell to around 1.41%. As interest rates declined after the beginning of the market, the stock index also showed a rebound, but when interest rates rebounded from the bottom in the second half of the market, the index also turned back. The 10-year U.S. Treasury bond rate reached 1.42% at the close of the stock market.
However, the Nasdaq, which had plunged by more than 3.5%, the largest since October last year, was relatively strong on this day.
Economically sensitive stocks were relatively sluggish, with energy-related stocks plunging due to a sharp fall in international oil prices.
The stability of key indicators, such as inflation, slightly softened the rise in interest rates.
The US Department of Commerce announced that personal consumption expenditure (PCE) in January increased by 2.4% (seasonally adjusted) from the previous month. It rebounded from a 0.4% decline in December last year, but was slightly slower than the 2.5% increase in expert estimates compiled by The Wall Street Journal.
In particular, the core PCE price index, excluding highly volatile food and energy, rose 1.5% year-on-year in January. Wall Street’s expected 1.5% rise.
America’s stimulus package is in a predetermined sequence.
The US House of Representatives plans to approve a $1.9 trillion stimulus package on the same day, major foreign media such as Barrance reported. The stimulus plan will be discussed in the Senate after the House is passed.
However, the possibility of amendment of the bill is raised as the Senate determines that the plan to increase the minimum wage cannot be included in this stimulus plan based on the budget adjustment method.
The White House expressed disappointment with the Senate’s decision.
On this day, energy fell 2.3% by industry, and financial stocks fell 1.97%. Technology shares rose 0.6%.
Other economic indicators released on this day were mixed.
According to the University of Michigan, the final value of the Michigan Consumer Attitude Index for February fell from 79.0, which was confirmed last month, to 76.8. However, it exceeded the previously announced preliminary value of 76.2 and met the market forecast of 76.8.
According to the Supply Management Association (ISM)-Chicago, the Chicago Purchasing Managers Index (PMI) for February fell to 59.5 from 63.8 last month. It also fell short of the expert’s estimate of 61.0.
The Ministry of Commerce announced in January that the deficit of the goods balance (seasonally adjusted value) was 83.8 billion dollars, an increase of 0.7% from 83.2 billion dollars in December last year.
New York stock market experts are on the lookout for rising interest rates.
Charlie Ripley, chief investment strategist at Allianz Investments, said, “Up to recently, market participants have been able to handle the rise in long-term interest rates, but future interest rate rises are likely to be more difficult to digest.” “The real interest rate was too low, so if economic indicators improve, long-term real interest rates could continue to rise,” he said.
According to the Chicago Merchandise Exchange (CME) Fed Watch, the FF interest rate futures market was 25bp in September.
We reflected the possibility of a rate hike by 9.8%.
On the Chicago Options Exchange (CBOE), the volatility index (VIX) recorded 27.95, down 3.25% from the previous trading day.
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2021/02/27 06:42 sent