Wall Street under pressure: yields rise, stocks fall – Apple defies trend

Bad mood on Wall Street: Bond yields are climbing to multi-year highs, and the stock markets are falling for the fourth day in a row. Apple is bucking the trend.

Concerns about another interest rate hike by the US Federal Reserve led to further losses on Wall Street on Thursday. A jump in oil prices and increased yields on US government bonds made stocks less attractive for investors. The Dow Jones index of standard stocks closed 0.6 percent lower at 52,064 points. The broader S&P 500 fell 0.6 percent to 7,592 points. The Nasdaq technology exchange index lost 0.7 percent to 26,082 points.

The inflation and interest rate concerns were triggered, among other things, by a sharp rise in oil prices. Because of delivery routes through the Strait of Hormuz and the Red Sea disrupted by the US and Israel's war against Iran, the price of the North Sea Brent variety jumped by six percent to $107 per barrel (159 liters). That fueled expectations that the Fed will raise interest rates at its meeting next week. According to the CME stock exchange's Fedwatch tool, traders now expect a rate increase of at least 25 basis points with a 70 percent probability. The day before, the probability was 64 percent.

But US producer prices for August have now been published and, as expected, they have increased. Now investors are looking forward to Friday's consumer price data.

At the same time, yields on the US bond market rose. Interest rates on ten-year government bonds rose to their highest level in almost three years, while those on 30-year bonds reached a 19-year high. "Yields are rising at the short end of the curve because the Fed is likely to raise interest rates in the next few months," said Ross Mayfield, investment strategist at Baird. At the long end, they rose because of national debt and stubborn inflation. Higher yields have a negative impact on the stock market. This depresses valuations and increases financing costs for companies and consumers.

In terms of individual stocks, technology stocks were under pressure. Industry heavyweights Nvidia and Micron Technology lost 2.3 and 4.7 percent respectively. Bucking the trend, Apple shares rose by 3.6 percent. The day before, the company introduced a foldable iPhone for $1,999.

In the retail sector, shares of American Eagle Outfitters fell 14 percent and fell to their lowest level since October. In view of fluctuating consumer spending, the clothing manufacturer had only confirmed its annual forecast for like-for-like sales. Shares in the department store chain Macy's fell 4.7 percent. An increase in the annual forecast failed to convince investors.