NEW YORK (dpa-AFX) – Another significant rise in yields on the US bond market pushed the leading index Dow Jones Industrial further into the red on Friday. Rising interest rates, for example, make bonds more attractive as an alternative to investing in stocks. Disappointing business figures for sporting goods manufacturer Nike and losses in bank shares were added to the burden.
The Dow fell 0.61 percent to 32,661.22 points after peaking the day before and then closing with slight losses. From a weekly perspective, this indicates a moderate minus.
The S&P 500 made up for its initial losses on Friday and was recently slightly lower again at 3913.83 points. The technology-heavy Nasdaq 100 recovered somewhat and gained 0.59 percent to 12,864.44 points. He had suffered on Thursday with a minus of more than 3 percent under the prospect of a deterioration in financing conditions in the face of further increases in market interest rates.
Stock marketers justified the latest rise in yields with the fact that the US Federal Reserve is surprisingly allowing a support measure taken during the Corona crisis to expire. Specifically, it concerns an exception to the SLR equity rule. The rule stipulates how much equity the banks must hold for various assets on their books in order to compensate for possible losses.
The Fed’s decision was not exactly expected, as some market participants had advocated an extension. On the US bond market, which is affected by the changes, prices fell noticeably. In return, yields rose – presumably out of concern that demand for government bonds could now decline.
Against this backdrop, bank stocks did not suffer well at the end of the week. Goldman Sachs fell by around one percent and JPMorgan even by three and a half percent. However, both shares had reached record highs the day before and thus profited from rising bond yields – in the hope of better interest rate deals.
Among the weakest stocks in the Dow, the shares of Nike sagged by around four percent. The world’s largest sporting goods manufacturer continues to benefit from the online shopping boom in the corona pandemic. But analysts had expected higher revenues.
Among the biggest winners in the S&P 500, Fedex shares won nearly six percent. The Post rival had earned significantly better in the most recent fiscal quarter thanks to the order boom in the pandemic./la/fba
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