US Equity Indexes Decline as Bond Yields Reach Nearly 19-Year High
The US equity indexes declined on Friday as government bond yields rebounded to their highest level in almost two decades. The Nasdaq Composite fell less than 0.1% to 26,407.2, while the S&P 500 and Dow Jones Industrial Average dropped 0.1% and 0.4%, respectively. Materials and utilities led decliners among all sectors except technology.
US Treasury yields rose after midday, with the 10-year yield jumping 5.1 basis points to 5%. The two-year yield climbed 4.9 basis points to 4.74%, reaching a multi-month high. Morgan Stanley expects two more hikes from the Federal Reserve, predicting a target range of 4.25 to 4.50% by year-end.
US equity funds recorded outflows for a fourth consecutive week due to rising crude oil prices and expectations of a Fed rate increase. The United Kingdom Maritime Trade Operations reported an unknown projectile hitting a tanker in the Strait of Hormuz, while Iran's Islamic Revolutionary Guard Corps claimed responsibility for striking a Togo-flagged tanker.
Gold futures rose 0.6% to $4,424.40, and silver futures jumped 1.6% to $67.19. Nucor shares slumped 6.3%, the worst performer on the S&P 500, after the company announced Q3 earnings below analysts' consensus.