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BCN-08
US-STOCKS-MARKETS
US stocks fall again as bond yields surge
NEW YORK, Oct 6, 2018 (BSS/AFP) – Wall Street stocks fell for a second
straight session on Friday on worries about runaway inflation spurred by the
sudden jump in US Treasury bond yields.
The Dow Jones Industrial Average fell 0.7 percent to 26,447.05.
The broad-based S&P 500 shed 0.6 percent to 2,885.57, while the tech-rich
Nasdaq Composite Index tumbled 1.2 percent to 7,778.45.
The declines came after the US Labor Department estimated that the country
added 134,000 net new positions last month, far weaker than analysts expected
and a figure that was likely dented by Hurricane Florence.
However, the unemployment rate fell to 3.7 percent last month from 3.9
percent, an unusually large drop and the lowest reading since December 1969.
Analysts said the bigger focus was the continued rise in the 10-year US
Treasury bond yield in anticipation of more Federal Reserve interest rate
hikes. The yield stood at 3.225 percent Friday, up 0.9 percent.
Investors fear higher costs for loans and mortgages will crimp growth.
Art Hogan, chief market strategist at B. Riley FBR, said the jump this
week in yields had been “breakneck” and could be “disruptive” to stocks.
Tesla Motors slumped 7.1 percent after Chief Executive Elon Musk mocked
the US Securities and Exchange Commission on Twitter, sparking worries that
an SEC settlement on fraud charges with Musk that let him remain CEO could
fall apart.
Costco Wholesale dropped 5.6 percent as it disclosed that it uncovered a
“material weakness” in its controls on financial reporting. The company said
it had not found any financial misstatements as a result of the flaw.
Analysts also said Costco’s profit margin came in a bit lighter than
expected in its quarterly results.
BSS/AFP/HR/0925