It was another rough day for US stock markets with the US bond yield hitting a 3 month high, finishing over 1.5%.
The result, as expected, was a sell-off in highly valued technology companies, dragging the Nasdaq down 2.8% and the S&P 500 2.0% lower.
The Dow Jones outperformed by comparison, falling 1.6% as the financials and energy sectors outperform.
Shares in vaccine maker Moderna (NASDAQ: MRNA), Wells Fargo (NYSE: WFC) and NVIDIA (NASDAQ: NVDA) were especially hard hit.
Debt ceiling to be breached, energy prices create stagflation concerns
Exacerbating the risk and causing a spike in volatility was more grandstanding over an impending government shutdown and the nearing of the debt ceiling.
However, the government has never defaulted on its debt and on every previous occasion both parties have come to the table.
Meanwhile, spiking gas and oil prices in Europe and Asia are contributing to the risk of stagflation. Cost increases reduce consumers’ propensity to spend, hitting growth at the same time that pandemic policy support is removed.
US stock market movers
Here’s how other popular US stocks fared on Tuesday.
- ConocoPhillips (NYSE: COP) up 1.6%
- Ford (NYSE: F) up 1.1%
- Microsoft (NASDAQ: MSFT) down 3.6%
- Facebook (NASDAQ: FB) down 3.7%
- Alphabet (NASDAQ: GOOGL) down 3.7%
- Trade Desk (NASDAQ: TTD) down 8.6%
This negative lead is expected to send the S&P/ASX 200 (ASX: XJO) lower when the market opens this morning. For all the latest, check out my ASX 200 morning report.
