Wall Street ends in the red surprised by bond yields

Wall Street ends in the red, surprised by bond yields

The New York Stock Exchange ended Tuesday sharply in the red, weighed down by an indicator that pointed to a still-strong American labor market, pushing bond yields to new highs.

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The Dow Jones fell 1.29%, the Nasdaq index lost 1.87% and the broader S&P 500 index lost 1.37%.

As in previous sessions, the pace was set by the bond market, which pushed the US 10-year bond yield to 4.80%, a first in more than 16 years.

The 30-year interest rate has also risen, reaching its highest level since September 2007, as has the 5-year yield.

The renewed rise in interest rate fever was encouraged by the publication of the so-called JOLTS report on movements on the labor market in August. He highlighted the recovery in job vacancies (+7.8% compared to July), which shows the robustness of the American economy.

“The Fed will not make a monetary policy decision based on this report, but it still maintains the risk of another rate hike through the end of the year,” commented Nancy Vanden Houten of Oxford Economics in a note.

A final increase in the key interest rate by the end of the year is now assumed by operators to be just as likely as a status quo, whereas just a month ago they considered this hypothesis to be very rare.

On the market, shares of the American pharmaceutical company Eli Lilly fell by 2.43%. It plans to buy biotech company Point Biopharma, +84.89% for around $1.4 billion to strengthen its position in cancer therapies, according to a joint press release.

With this operation, Eli Lilly – one of the largest insulin producers in the world – receives targeted therapy against prostate cancer using radioligand therapy.

Airbnb (-6.47%) suffered from a note from KeyBanc that said the momentum the platform had enjoyed post-pandemic is fading. On Monday, general manager and co-founder Brian Chesky believed it was time to “get things right,” citing criticism from users, particularly regarding prices deemed too high.