Jakarta, CNBC Indonesia – The stock exchange of the United States (US) opened racing on Wednesday (10/3/2021), after February inflation proved to be maintained so that yields (yield) US government bonds are no longer skyrocketing.
The US consumer price index (CPI) as of February grew 0.4% (monthly) and 1.7% (yearly), while core inflation (excluding food and energy) was 0.1%. This is in line with the results of the Dow Jones poll.
The Dow Jones Industrial Average rose 175.9 points (+ 0.55%) at 8:30 am local time (21:30 WIT) and 25 minutes later to 332.4 points (+ 1.04%) to 32,165.18. The S&P 500 rose 34.9 points (+ 0.9%) to 3,910.33 while the Nasdaq jumped 168.2 points (+ 1.29%) to 13,242.07.
“The biggest concern in the market in about the past month has been regarding inflation that was worse than our estimate. But it is clear that the CPI is extinguishing that at least for today,” said Art Hogan of National Securities, as quoted by the statement. CNBC International.
Following the passage of the US $ 1.9 trillion stimulus in the Senate, yields (yield) US government bonds maturing 10 years earlier rose slightly in the range of 1.56%. Investors are now closely monitoring the auction results of the absorption of 10-year SBN worth US $ 38 billion.
The market is also watching the approval of a US $ 1.9 trillion stimulus that US President Joe Biden will sign later this week. The package will include new unemployment benefits worth US $ 300 / week and direct cash assistance (BLT) worth US $ 1,400 / head of family.
Technology stocks rebounded since last Tuesday so that the Nasdaq index shot up 3.7% or become the best since November. Earlier on Monday, the index of top technology shares fell more than 10% from its record high.
Tesla shares at the opening today jumped 6% and Zoom Video jumped 3%. Rising inflation expectations in recent days have triggered a rise in US government bond yields which put pressure on technology stocks.
The reversal of technology stocks to the green zone coincided with lower yields (yield) U.S. government bonds that are the benchmark of the market. The 10 -year tenor SBN weakened more than 5 basis points on Tuesday to 1.54% after touching 1.62% on Monday.
CNBC INDONESIA RESEARCH TEAM
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