Jakarta, CNBC Indonesia – Stock exchanges in the United States (US) opened lower on Tuesday (23/2/2021), following the collapse of technology stocks amid fears of rising yields (yield) US government bonds and transfers to cyclical stocks.
The Dow Jones Industrial Average fell 71.3 points (+ 0.23%) at 8:30 am local time (21:30 WIT) and 20 minutes later to minus 111 points (-0.35%) to 31,410.69. The S&P 500 fell 41 points (-1.06%) to 3,835.47 and the Nasdaq fell 394.9 points (-2.92%) to 13,138.13.
The S&P 500 and Nasdaq Index yesterday posted weekly corrections of 0.7% and 2.5%, respectively. Meanwhile, Dow Jones was still able to score a rally, albeit slightly, at 0.09%, thanks to a rally in travel sector stocks such as airlines and ships.
The Nasdaq Index experienced major losses due to falling shares of Apple and Tesla while the S&P 500 index fell as investors worried about seeing a rise yield the benchmark US government bond which today stood at 1.37% (28 basis points / bp or 0.28 percentage point) throughout February.
“The higher the yield on US government bonds, the faster investors will rotate their portfolios, from technology stocks to constituent stocks of the Russell 2000 index and the Dow Jones,” said OANDA senior analyst Edward Moya in a research report cited. CNBC International.
In the latest development, Facebook reached an agreement with the Australian government and will restore the Kangaroo Country news page on the application.
The bond market will still attract investors, especially because the Chairman of the Federal Reserve (The Fed) Jerome Powell tonight (WIB) will start his speech at the US Congressional Hearing Meeting (RDP).
The boss of the strongest central bank in the world is maintaining his tough stance that the benchmark interest rate hike will not be taken. However, the latest comments related to this will still be awaited because there is a potential for inflation to increase when the US $ 1.9 trillion stimulus is disbursed.
Concerns about inflation have increased in recent weeks after a political debate over the need for further stimulus after new Covid-19 cases continued to decline thanks to vaccinations.
Investors will also monitor consumer confidence data and house prices, while listed companies Home Depot and Macy’s will report their financial performance before the market opens.
CNBC INDONESIA RESEARCH TEAM
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