Treasury Yields End at Nearly 2-week Highs as Traders Assess Chances of a Trump Win
US stocks closed with all three major indices falling, with the S&P Nasdaq index seeing its largest weekly decline in three months. Technology stocks weakened, with Tesla down more than 4%, Nvidia down more than 2%, and CrowdStrike down more than 11%.
Investors accelerated their escape from technology stocks, with stocks and bonds in Europe and the United States being hit hard for two days. This week, the S&P 500 and Nasdaq fell by about 2% and 3.7%, respectively. The Nasdaq stopped its six-week continuous rise, while the Dow and small-cap indices rose by 0.7% and 1.7%, respectively. Chip stocks fell more than 3% on Friday and nearly 9% for the week. Nvidia also fell more than 8.7% for the past three months, making it the worst performer. The "seven sisters of technology" all fell for the week, and cybersecurity leader Crowdstrike, which triggered a global technology outage, fell 11% on Friday, the worst in nearly two years. The VIX panic index rose more than 32% for the week.
Treasury Yields Rise While U.S. Indicators Cool Down -- Market Talk
Two officials of the Federal Reserve indicated that it is necessary to reform the discount window tool.
Boorman, a director of the Federal Reserve, and Logan, the president of the Dallas Federal Reserve, suggested that the Federal Reserve should assess to what extent its emergency lending tools can meet the liquidity needs of the banking system, implying the need to reform the discount window.
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The Nasdaq fell nearly 2%, with the largest selling volume of the 'Seven Sisters' in a year and a half, while small caps and Chinese concept stocks surged, and US bonds rose sharply.
Comprehensive cooling of US inflation, September rate cut betting pushing US stocks rotation, S&P and Nasdaq ended seven-day consecutive gains and moved away from their highs, Tesla plummeted 8.4%, the worst in nearly half a year and stopped 11-day consecutive gains, Nvidia fell 5.6%, and the chip index fell 3.5%. The Russell 2000 small-cap stocks rose 3.6%, the best since November last year and the highest in two and a half years, and the worst-performing real estate sector this year had the largest increase in the year. US bond yields fell sharply across the board, with the US dollar falling the deepest in two months. The yen rose by 2.6% at one point, the biggest gain since the end of 2022, and anonymous officials confirmed that the government intervened to rescue the currency.
How do high officials of the Federal Reserve view the significant cooling of inflation in the USA?
Two senior officials from the Federal Reserve spoke on Thursday, stating that inflation is making progress. The president of the St. Louis Reserve stated that the current policy interest rate is appropriate at this stage. The president of the San Francisco Reserve stated that given recent employment and inflation data, the Federal Reserve may need to make interest rate adjustments, but did not provide a specific schedule for rate cuts.
"Xinmei Federal Reserve News Agency" evaluates CPI in June: Mild inflation opens the door for a rate cut in September.
According to Timiraos' article, after the release of CPI, investors have increased the possibility of rate cuts in September, November, and December this year. A major question at this month's Fed meeting is how much basis Fed officials have laid for a rate cut in September. This year's FOMC voter, President of the San Francisco Fed, Daly, expects that it may be reasonable to cut interest rates soon after the announcement of the CPI, but also said that more information needs to be collected.
US Treasury Yields Plummet as Inflation Surprises, Fed Dovish Bets Grow