Bulletin
Investor Alert

New York Markets Close in:

Market Snapshot Archives | Email alerts

March 23, 2021, 5:14 p.m. EDT

Nasdaq ends 1.2% higher, Dow and S&P 500 snap 2-day skid as Treasury yields retreat

new
Watchlist Relevance
LEARN MORE

Want to see how this story relates to your watchlist?

Just add items to create a watchlist now:

  • X
    Dow Jones Industrial Average (DJIA)
  • X
    S&P 500 Index (SPX)
  • X
    NASDAQ Composite Index (COMP)

or Cancel Already have a watchlist? Log In

By Mark DeCambre and Joy Wiltermuth

U.S. stock benchmarks closed higher Monday, following losses for all three major indexes last week, as investors weighed brightening economic prospects against worries that interest rates will climb faster than anticipated.

How did stock benchmarks perform?

  • The Dow Jones Industrial Average /zigman2/quotes/210598065/realtime DJIA +0.64% rose 103.23 points, or 0.3%, to close at 32,731.20, snapping a 2-session losing streak.

  • The S&P 500 /zigman2/quotes/210599714/realtime SPX -0.21% added 27.49 points, or 0.7%, to close at 3,940.59, also ending a 2-sessions slide.

  • The Nasdaq Composite Index /zigman2/quotes/210598365/realtime COMP -1.67% advanced 162.31 points to finish at 13,377.54, a gain of 1.2%, it’s largest daily jump in about 1.5 weeks, according to Dow Jones Market Data.

  • The small-capitalization Russell 2000 index /zigman2/quotes/210598147/delayed RUT -1.06% ended 0.9% lower at 2,266.84.

On Friday , the Dow put in a weekly decline of 0.5%, the S&P 500 and the Nasdaq both slid 0.8%.

What drove the market?

Technology-related stocks helped lift equities higher on Monday, after a modest pullback of the 10-year Treasury yield /zigman2/quotes/211347051/realtime BX:TMUBMUSD10Y +1.52% gave the start of March’s last full week of trading a boost.

Highflying tech shares were big winners amid the COVID-19 pandemic, but they also have been under pressure in recent months as government bond yields have risen.

The 10-year Treasury yield stood around 1.682% Monday, down from 1.729% Friday. Rising bond yields have been partially welcomed by Wall Street investors, as a sign of the U.S. economy’s return to health, but caution remains about if another sharp spike in rates could cause disorder in financial markets.

Read: Why you should not freak out about the 10-year U.S. Treasury yield hitting 1.7%

“Rising yields have yet to become overly punitive for the economy and risk assets, but 2.5% on the 10yr may be a key threshold,” a team led by Jason Pride, chief investment officer at Glenmede’s private wealth division, wrote in a note Monday.

Investors have been skittish about the outlook for buying stocks on the heels of additional fiscal stimulus, state reopenings and vaccine rollouts that could lead to a major upswing for the economy and higher interest rates, as falling bond prices push yields higher and make speculative and high-growth assets look less compelling.

“With the federal debt now at $29 trillion and a total debt-to-GDP ratio at an astounding 145%, nominal inflation and interest rates have increased sharply in recent months,” said Phil Orlando, Federated Hermes’ chief equity market strategist, in emailed comments.

Orlando also said sharply higher 10-year Treasury yields “will certainly impair our ability to service that growing debt level.”

Concerns about climbing U.S. debt levels come as President Joe Biden’s economic team was preparing to recommend spending as much as $3 trillion on a set of efforts to boost the economy, reduce carbon emissions and narrow economic inequality, the New York Times  reported Monday

Last week’s slide lower for major stock benchmarks came after the Federal Reserve appeared to strike a dovish tone at its policy meeting on Wednesday, but bond yields rose on expectations for economic recovery and inflation this year.

“The Fed itself may remain one of the most important risks in the near term, simply due to market (over) reaction to its comments and (in) actions,” wrote Saira Malik, chief investment officer at Nuveen, in emailed comments.

/zigman2/quotes/210598065/realtime
US : Dow Jones Global
35,001.58
+223.82 +0.64%
Volume: 195.73M
May 10, 2021 2:01p
loading...
/zigman2/quotes/210599714/realtime
US : S&P US
4,223.78
-8.82 -0.21%
Volume: 1.27B
May 10, 2021 2:01p
loading...
/zigman2/quotes/210598365/realtime
US : Nasdaq
13,522.81
-229.43 -1.67%
Volume: 2.84M
May 10, 2021 2:01p
loading...
/zigman2/quotes/210598147/delayed
US : US Composite
2,247.52
-24.10 -1.06%
Volume: 929,827
May 10, 2021 1:46p
loading...
/zigman2/quotes/211347051/realtime
add Add to watchlist BX:TMUBMUSD10Y
BX : Tullett Prebon
1.60
+0.02 +1.52%
Volume: 0.00
May 10, 2021 2:00p
loading...
1 2
This Story has 0 Comments
Be the first to comment
More News In
Markets

Story Conversation

Commenting FAQs »

Partner Center

Link to MarketWatch's Slice.