By Stan Choe, Associated Press Business Writer
NEW YORK (AP) – Wall Street will continue on Tuesday from his records, on the way to the pressure of the bond market.
The S&P 500 dropped 0.9% after a decrease of no less than 1.4% at the start of the trade. The industrial average of Dow Jones fell by 305 points, or 0.7%, from 10:10 am Eastern time, and the Nasdaq composite had fallen 1.1%. All three are still relatively close Their recently set of all time Highs.
Nvidia and other companies that have benefited from the frenzy nearby Artificial Intelligence Technology were some of the heaviest weights on the market. They have risen for years about the conviction that they are at the forefront of the next revolution for the world economy. But they also shot so high that critics say that their prices have just become too expensive.
Nvidia, whose chips much of the move to AI flows, fell 2.1%.
Other losing Big Tech shares were Amazon, which dropped 1.9%, and alphabet, which dropped 1.8%.
The total stock market felt the pressure of the rising returns on the bond market, where the 10-year-old Treasury return rose to 4.23% at the end of Friday to 4.23%. When bonds pay more interest, investors are less willing to pay high prices for shares.
Long -term bond returns are increasing all over the world, partly because of worries about how difficult it will be for governments to repay their growing mountains of debts.
In the United States, the proceeds from the Treasury feel extra pressure in the longer term President Donald Trump’s attacks on the Federal Reserve For not reducing interest rates faster. The fear is that a less independent Fed will make the unpopular decisions that are needed to keep inflation Under control, such as keeping short -term interest rates than investors would like.
Tuesday was also the first opportunity to act in the American Treasury market after a Federal Court of Appeal had ruled that Trump exceeded his legal authority When announcing radical rates on almost every country on earth, although it left the rates in place for the time being. Although the rates have created confusion and can harm the American labor market, they have also generated income that can help the US government to pay part of its debt.
In another signal about increasing the worries in the financial markets, the price of gold rose by 1.1% and was near his record. The metal often has one Harbor for investors In times of uncertainty.
Treasury proceeds have cut their profits a bit after a report said that the American production had contracted last month than economists expected. Many companies told the Institute for Supply Management’s Survey that remain rates to make conditions chaotic.
“Too much uncertainty for us and our customers with regard to rates and the US/global economy,” said a company in the industry of chemical products, while noticing that orders in most product lines were weakened.
The poorer-awaited report could give the Federal Reserve more leeway to reduce its most important interest for the first time this year during the next meeting in a few weeks. That in turn helped the stock prices to lower their losses.
On Wall Street, Constellation Brands tumbled 6.8% after the beer, wine and spirits company warned that it has seen a delay in purchasing his high-quality beers, especially among his Spanish customers. That pushed it to lower his prediction for profit this tax year.
Kraft Heinz fell by 3.5% after he announced it It splits into twoA decade after one Merger of the brands created one of the largest food companies in the world.
One of the companies will include plank -stable meals and brands such as Heinz, Philadelphia Cream Cheese and Kraft Mac & Cheese. The other includes the Oscar Mayer, Kraft singles and lunchables brands. The official names of the two companies will be released later.
One of the few profit of the market was Pepsico, which rose 2.9% after an investment firm said it had sent the company’s board to re -raise the growth of its growth and to stimulate financial performance. The investor, Elliott Management, has a history of buying companies and then insisting on major changes that can lead to better equity performance.
On stock markets abroad, the indexes fell throughout Europe, with the German Dax lost 1.7%. That was after a more mixed finish in Asia, where indexes rose by 0.9% in Seoul, only 0.5% fell in Hong Kong.
AP -company Elaine Kurtenbach has contributed.
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