Wall Street opened lower on Thursday as rising government bond yields and higher oil prices affected investor sentiment. The Dow Jones Industrial Average fell 81.8 points, or 0.15%, to 53,381.22. The S&P 500 declined 17.5 points, or 0.23%, to 7,690.49. The Nasdaq Composite dropped 119.6 points, or 0.45%, to 26,211.52 at the opening bell.
Key Details
The yield on the benchmark 30-year US Treasury rose to 5.25%. This reversed some of the relief seen after a recent policy shift by the Treasury Department towards bond buying. The rise in yields added to the overall negative market trend. Oil prices also increased by more than 2%. Brent crude was trading at $93.60 per barrel, while US crude was at $86.26 per barrel. This increase followed US President Donald Trump’s threats of economic action against Iran, raising concerns about potential disruptions in the energy market.
Walmart played a major role in the market decline. Its shares fell nearly 8% after the retail giant reported mixed earnings. Although Walmart raised its annual profit forecast, it noted a slowdown in growth for US comparable sales. It also cited pressure from new US regulations on pharmaceutical pricing. Other notable stock movements included a 22.2% drop in Advance Auto Parts and an 18% decline in Moderna's stock, which had surged the previous day.
The rise in bond yields is likely to pressure sectors sensitive to interest rates, such as utilities and real estate. Higher oil prices could lead to increased costs for consumers and businesses, further affecting market sentiment.
Background
Investors should watch for upcoming earnings reports from major retailers. These may provide more insights into consumer spending trends.
Based on reporting by: businesstimes.com.sg, livemint.com