Dow falls for third day, losing more than 100 points as Treasury yields hit multi-year highs: Real-time updates

Stocks fell on Thursday, extending losses this week as Treasury yields rose to multi-year highs after the Federal Reserve planned to keep interest rates higher for longer.

The Dow Jones Industrial Average fell 190 points, or 0.6%. The S&P 500 lost 1.1% and the Nasdaq Composite lost 1.3%.

The Dow and S&P 500 were on track to end the week down about 1% and 2%, respectively, while the Nasdaq was expected to fall nearly 3%.

The 10-year Treasury yield rose to 4.48%, its highest level in more than 15 years, and the latest catalyst is weekly jobless claims data, pointing to a still-strong job market that could encourage the Fed to continue their increases. In the week of September, weekly jobless claims fell from 20,000 to 201,000.16, far fewer than the 225,000 inquiries predicted by economists surveyed by Dow Jones. This is the lowest number of new jobless claims since January.

The two-year bond yield peaked at 5.19% on Thursday amid the jobs data, also the highest since 2007.

“This is kind of a red flag for the markets right now,” said Adam Turnquist. Managing Director. Technical strategist at LPL Financial, current yield developments. He added that yields “certainly have an impact on risk appetite at this point.”

The moves came a day after the Federal Reserve said it would keep interest rates unchanged but announced another rate hike before the end of the year. The central bank also stressed that there would be fewer rate cuts next year, essentially saying it needed to keep rates higher for longer due to persistent inflation.

After this decision, Fed Chairman Jerome Powell said that a soft landing for the economy was still possible, but that it was not consistent with the base case.

“I think we’re seeing some gap between expectations and what’s happening,” said Shelby McFaddin, an investment analyst at Motley Fool Wealth Management.“If you’re an investor … it doesn’t seem ideal because it seems to point to a higher interest rate environment over the long term.”

technology stocks have suffered losses this week as investors reconsider buying growth stocks if interest rates remain high. Thursday’s declines included Tesla, Alphabet, Meta Platforms and Nvidia.

Marketing automation company Klaviyo, which debuted on the public markets on Wednesday, fell 3% on Thursday. That made the company’s shares the latest in a string of promising IPOs to fall this week.

FedEx broke the negative trend with an increase of more than 4.5 liters. In the fiscal first quarter, the delivery company reported adjusted earnings per share of $4.55 per share, compared to analysts’ expectations of $3.73 per share, on LSEG.

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