Thursday's Market Recap - Velocity Of US 10 Year Bond Yield Scare Equity Markets
What is The Premarket Telling Us?
7:00 PM.
The US market set up is looking negative at this time. Dow futures down 81 points, Nasdaq futures down 45 points, and S&P futures down 11 points.
A Bloomberg report, out this morning indicated that China may have included a small microchip on servers, at the point of manufacture, in China. Apple, Amazon, the companies named as the target of the spying, have vehemently denied these claims.
Vice President Pence in a speech today, accuses China of interfering in the US internal affairs.
On The Bond Desk:
The US 10 Year Bond Yield at 3.16%, up 0.10% or ten basis points.
Currency Desk:
Euro dollar: 1.14
UK Pound: 1.29
Crude Oil:
WTI crude oil futures at $76.31/barrel, down 0.13%.
On the Earnings Calendar:
None
In M&A News:
None.
What About The Asian And European Markets?
Major Asian markets mixed. Japan (Nikkei 225) fell 0.56%, Shanghai closed, Hong Kong (Hang Seng) down 1.73%.
Major European markets fell modestly in today's session. German (DAX) down 0.35%, France CAC 40 off 1.47%, London FTSE 100 down 1.22%.
Market And Sector Dynamics
Red arrows dominated today's market open. The major indices were all lower, with the Dow down 60 points, Nasdaq down 40 points, and the S&P down 8 points. Investor appear visibly nervous about rapid uptick of the US 10 bond yield over the last two days. This morning the yield has ranged between 3.19 % - 3.22%, after hovering in the 3.06 - 3.08 in the last few weeks. Investor seemed most concerned with the velocity of the rate move.
WTI crude oil was modestly lower early, at $75.75/barrel, down 0.79%, putting some pressure on the energy complex.
The downward pressure on stocks continued during the morning session, with the Dow down 305 points around 12:30 PM, sinking even further, hitting the low of the day just before 2:00 PM, Dow down 356 points. Stocks bounced off those lows a hour before the close.
Nine of the eleven S&P sectors closed the day with moderate losses, led by technology, consumer discretionary, communications, healthcare, real estate, energy, and basic materials. Financials and utilities were higher.
Factors Influencing Today's Market
The velocity of rising US 10 year bond yield spooked investors in today's session.Fear of rising inflation.
Bloomberg report of China spy chips placed in servers manufactured in China, and used by Apple and Amazon.
Crude oil traded lower today. WTI crude oil closed at $74.33/barrel, down 2.72%.
This week's Initial Jobless Claims fell 8000 claims to 207,000.
Both Asian and European stocks were lower in their session.
Market Close Volume Traded And Advance Decline Ratio
When the markets closed the indices were solidly lower. The Dow fell 200.91 points, Nasdaq down 145.57 points, and the S&P lost 23.90 points. Total NYSE volume traded, a moderate 3.46 billion shares. Declining shares outpaced Advancing shares neatly 4:1.
Data Sources: Bloomberg, CNBC, CNN Money, Google Finance, Market Watch, TD Ameritrade, Yahoo Finance.
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