- US stocks fell on Thursday as the 10-year US Treasury yield jumped to its highest level since 2007.
- The surge came after the Federal Reserve indicated that rates will stay higher for longer.
- Jobless claims fell to 201,000 last week, signaling the labor market remains tight.
US stocks fell on Thursday, extending their week- and month-long decline, as bond yields surged following the Federal Reserve's meeting on Wednesday.
The 10-year US Treasury rate jumped to a high of 4.49% on Thursday, representing its highest level since October 2007. Fed Chairman Jerome Powell telegraphed that inflation still remains a top concern and the Fed's "dot plot" forecasts signaled only two rate cuts in 2024, whereas the market expected closer to three or four cuts next year.
"He underscored numerous times that while the Fed remains data dependent and can proceed carefully, but another rate hike remains on the table as the Fed is seemingly wedded towards restoring price stability," LPL Financial strategist Quincy Krosby told Insider.
Meanwhile, jobless claims fell to 201,000 last week, the lowest reading since January and below economist estimates of 225,000, signaling the labor market remains tight.
Here's where US indexes stood shortly after the 9:30 a.m. opening bell on Thursday:
- S&P 500: 4,368.61, down 0.76%
- Dow Jones Industrial Average: 34,239.01, down 0.59% (201.87 points)
- Nasdaq Composite: 13,351.23, down 0.88%
Here's what else is going on today:
- Nvidia's stellar 2023 rally flamed out this month, with the semiconductor giant shedding nearly $180 billion in market value as its stock price feels the full force of the "September effect."
- China is probing the activities of hedge funds that use quantitative trading strategies to bet against its struggling stock market.
- Investors should brace for another interest-rate increase by the Federal Reserve, with the recent surge in oil prices likely to rekindle inflation pressures, billionaire investor Jeff Gundlach said.
- Billionaire investors Ken Griffin and Bill Ackman met with Volodymyr Zelenskyy as Ukraine looks to rebuild its economy with private-sector funds.
In commodities, bonds, and crypto:
- West Texas Intermediate crude oil rose 1.03% to $90.58 a barrel. Brent crude, the international benchmark, jumped 0.75% to $94.23 a barrel.
- Gold fell 1.65% to $1,934.60 per ounce.
- The yield on the 10-year Treasury bond rose five basis points to 4.47%.
- Bitcoin fell 2.24% to $26,519.