US stocks closed lower Tuesday while the 10-year Treasury yield held above 3%. Fresh housing data showed new home builds slowed for the sixth-consecutive month. The 10-year yield briefly dipped below 3% after the weak housing data, but rebounded to climb back above it. Loading Something is loading.
US stocks were lower at the market close Tuesday as traders continued to speculate on how aggressively the central bank will tighten policy.
The Dow Jones Industrial Average led the decline, while the Nasdaq lost less than one point to finish essentially flat.
Federal Reserve Chair Jerome Powell is set to speak at an annual symposium on Friday, with investors hoping for more forward guidance on rates as policymakers look to bring down inflation further.
New housing data out Tuesday showed that new US home builds slowed for the sixth-straight month in July. The 10-year yield briefly dipped below 3% as the weak housing data raised recession fears and the prospect of a less hawkish Fed. But the yield later rebounded back above 3%.
Here’s where US indexes stood as the market closed at 4:30 p.m. on Tuesday:
S&P 500: 4,128.72, down 0.22%Dow Jones Industrial Average: 32,909.59, down 0.47% (154.02 points)Nasdaq Composite: 12,381.30, 0.00% JPMorgan’s Marko Kolanovic thinks that the central bank has overreacted with its last 75 basis-point rate hike and is set to pivot to easing. Kolanovic wrote in a note on Monday that “inflation will resolve on its own” and the S&P 500 could hit 4,800.
But Bespoke Investment Group said Tuesday that the 10-year Treasury yield’s rebound back above 3% pushes US stocks on a path of potential losses over the next few weeks.
Meanwhile, energy consumption in the US soared in July amid record heatwaves. A new report from the Energy Information Administration said power plants reached 6.87 million megawatt hours at the end of last month. Natural gas prices climbed to $10 per million British thermal units for the first time in 14 years.
Elsewhere, Russia is ramping up its seemingly dormant diamond export industry after sanctions crippled the sector.
Crude oil rose as OPEC+ said more output cutbacks could come if Iran’s talks over its nuclear agreement with result in a deal allowing Tehran to add flows to the market. West Texas Intermediate climbed 3.56% to $93.58 a barrel while international benchmark Brent crude added 3.68% to $100.02.
Gold gained 0.68% to $1,747.63 an ounce. The 10-year yield rose added another 1.5 basis-points to 3.05%.
Bitcoin slipped 0.24% to $21,511.13.
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