Markets Go Haywire As US Payrolls Defy Gravity: 30-Year Yields Soar To 5%, Dollar Rallies, Equities Tumble
Portfolio Pulse from Piero Cingari
The US job market report released by the Bureau of Labor Statistics showed a surge in non-farm payrolls to 336,000 in September, significantly surpassing expectations. This strong employment growth signals the resilience of the US labor market, which could lead the Federal Reserve to maintain higher interest rates. Market reactions included a surge in the yield on 30-year Treasury notes to 5%, a strengthening of the US dollar, and a decline in stocks due to concerns about additional Federal Reserve interest rate hikes. The SPDR S&P 500 Trust (SPY), Invesco QQQ Trust (QQQ), Tesla Inc. (TSLA), and Utilities Select Sector SPDR Fund (XLU) all experienced declines.
October 06, 2023 | 2:12 pm
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The Invesco QQQ Trust (QQQ) fell 0.9% due to concerns about additional Federal Reserve interest rate hikes.
The strong job market report could lead the Federal Reserve to maintain higher interest rates, which is generally negative for stocks. This is likely the reason for the decline in QQQ.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
The SPDR S&P 500 Trust (SPY) was 0.7% lower when Wall Street opened on Friday due to concerns about additional Federal Reserve interest rate hikes.
The strong job market report could lead the Federal Reserve to maintain higher interest rates, which is generally negative for stocks. This is likely the reason for the decline in SPY.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
Tesla Inc. (TSLA) was down 3%, making it the underperformer among the 'Magnificent 7' stocks.
The strong job market report could lead the Federal Reserve to maintain higher interest rates, which is generally negative for stocks. This is likely the reason for the decline in TSLA.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80
NEGATIVE IMPACT
The Utilities Select Sector SPDR Fund (XLU) experienced the steepest decline, dropping by 2.3%.
The strong job market report could lead the Federal Reserve to maintain higher interest rates, which is generally negative for stocks. This is likely the reason for the decline in XLU.
CONFIDENCE 90
IMPORTANCE 70
RELEVANCE 80