Equities turn higher as Treasury yields drop from highs
SPY•U.S. stocks turned higher Thursday as Treasury yields retreated after reaching multi-decade highs. The Dow rose 0.01%, the S&P 500 gained 0.24% and the Nasdaq added 0.25%.
1. Stocks rebound
U.S. stocks turned higher in choppy trading after the S&P 500 fell early to a two-week low. The reversal followed a retreat in Treasury yields after a global bond selloff had pushed the 10-year yield to a 24-year high.
2. Yields and rate outlook
Weekly initial jobless claims dipped to 197,000, below the 200,000 forecast, while manufacturing input prices rose, adding to inflation concerns. Yields declined after buyers stepped in and Federal Reserve Vice Chair Philip Jefferson suggested the central bank may be patient before raising rates again. Markets priced in a 28.2% chance of a hike of at least 25 basis points at the October meeting, down from 68.6% a week earlier.
3. Sector and company moves
The S&P 500 energy index rose almost 2% as Brent crude gained nearly 5% after China suspended fuel exports. Accenture shares rose 17% after the company forecast full-year revenue growth above estimates; Micron shares slipped about 1.7% despite a better-than-expected revenue forecast and $32 billion in customer commitments under supply agreements.
