Stock Market Today: Nasdaq, S&P Snap Weekly Win Streaks as Tech Slumps
The 10-year Treasury yield hit its highest level since late July after Fed officials chimed in on rate hikes.
You are now subscribed
Your newsletter sign-up was successful
Want to add more newsletters?
Delivered daily
Kiplinger Today
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more delivered daily. Smart money moves start here.
Sent five days a week
Kiplinger A Step Ahead
Get practical help to make better financial decisions in your everyday life, from spending to savings on top deals.
Delivered daily
Kiplinger Closing Bell
Get today's biggest financial and investing headlines delivered to your inbox every day the U.S. stock market is open.
Sent twice a week
Kiplinger Adviser Intel
Financial pros across the country share best practices and fresh tactics to preserve and grow your wealth.
Delivered weekly
Kiplinger Tax Tips
Trim your federal and state tax bills with practical tax-planning and tax-cutting strategies.
Sent twice a week
Kiplinger Retirement Tips
Your twice-a-week guide to planning and enjoying a financially secure and richly rewarding retirement
Sent bimonthly.
Kiplinger Adviser Angle
Insights for advisers, wealth managers and other financial professionals.
Sent twice a week
Kiplinger Investing Weekly
Your twice-a-week roundup of promising stocks, funds, companies and industries you should consider, ones you should avoid, and why.
Sent weekly for six weeks
Kiplinger Invest for Retirement
Your step-by-step six-part series on how to invest for retirement, from devising a successful strategy to exactly which investments to choose.
Tech stocks led the broader market lower Friday, as government-bond yields spiked after a pair of Federal Reserve officials weighed in on rate hikes.
The 10-year Treasury yield jumped as high as 2.998% – its loftiest level since late July – before ending up 9.4 basis points at 2.974%. (A basis point is one-one hundredth of a percentage point.)
This came after St. Louis Fed President James Bullard – a current voting member of the Federal Open Market Committee (FOMC) – said in an interview with The Wall Street Journal Thursday that he "would lean toward [raising rates] the 75 basis points" at the central bank's September meeting. "I think we've got relatively good reads on the economy, and we've got very high inflation, so I think it would make sense to continue to get the policy rate higher and into restrictive territory," Bullard added.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
And this morning, Richmond Fed President Thomas Barkin said at an event in Maryland that the central bank "will do what it takes" to get inflation back down to its 2% target. Barkin is not a voting member of the FOMC this year.
Monthly options also played a part in today's volatile price action. Options expiration activity can increase liquidity in the market, says Souhow Yao, analyst at Susquehanna Financial Group, and can exacerbate price moves in the underlying stocks or indexes. Today, over $2 trillion worth of options contracts expired.
Technology (-1.8%) was one of the weaker sectors in today's selloff, dragging the Nasdaq Composite down 2.0% to 12,705. The S&P 500 Index finished 1.3% lower at 4,228, and the Dow Jones Industrial Average gave back 0.9% to 33,706. All three indexes closed lower on the week, with the Nasdaq and S&P 500 snapping their weekly win streaks.
Other news in the stock market today:
- The small-cap Russell 2000 plunged 2.2% to 1,957.
- U.S. crude futures rose 0.3% to settle at $90.77 per barrel, but still finished the week down 1.4%.
- Gold futures gave back 0.5% on the day to end at $1,762.90 an ounce. For the week, gold prices fell 2.9%.
- Bitcoin plunged 8.6% to $21,349.47. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m.) "Weakness has seeped into the crypto sphere as speculators retreated from highly risky assets amid expectation that higher interest rates were set to linger for much longer," says Susannah Streeter, senior investment and markets analyst at U.K.-based financial firm Hargreaves Lansdown.
- Thursday's confirmation that Ryan Cohen, GameStop (GME) board chair and Chewy (CHWY) founder, sold his entire stake in Bed Bath & Beyond (BBBY) sent the shares into another tailspin today. A regulatory filing showed Cohen unloaded his entire 8.1-million stake at prices ranging from $18.68 per share to $29.22 per share, and sold all of his call options. BBBY shares plunged 40.5% in reaction.
- Foot Locker (FL) surged 20.0% after the athletic apparel retailer reported earnings. The company brought in a per-share profit of $1.10 per share in the second quarter, beating the consensus estimate by 30 cents. Revenue of $2.1 billion was in line with expectations. The company also announced a C-suite shocker that caused BofA Securities analyst Lorraine Hutchinson to upgrade the stock to Neutral from Underperform (the equiavalents of Hold and Sell, respectively. "In a surprise move, FL announced that current President, Chairman and CEO Richard Johnson will retire from the company and will be replaced by former Ulta (ULTA) CEO Mary Dillon," the analyst says. "This is a thesis-changing move in our view given Dillon's reputation in the industry. She is a highly respected consumer executive who most recently was CEO of Ulta Beauty for 8 years through June 2021. While at the helm at Ulta, Dillon engineered a best-in-class loyalty program, revenue increased at a 16% CAGR, and the stock tripled."
Stay Prepared With Your Portfolio Picks
Wall Street could get more color on the Fed's monetary policy outlook next week, with the central bank hosting its annual Jackson Hole symposium. "A major source of friction between the market and central bank communications has been around the issue of how long rates will need to stay relatively high to corral inflation," says Douglas Porter, chief economist at BMO Capital Markets. "Next week's headline event may focus on this very issue," he adds. "This year's theme for the symposium is 'Reassessing Constraints on the Economy and Policy.' Sustained strength in underlying inflation would be a meaningful constraint on both the economy and the room to maneuver for policy."
So what does this mean for investors? Well, it might be a good time to do a portfolio check, making sure it's positioned for continued inflation, additional rate hikes and more volatility in the market. Does it include dividend stocks? Is there exposure to companies with pricing power or healthcare stocks, both of which are considered inflation hedges? Investors looking for broader protection might want to consider these defensive ETFs. The funds featured here use a variety of strategies but share the same goal: providing stability against the macro-headwinds still impacting markets.
-
The Cost of Leaving Your Money in a Low-Rate AccountWhy parking your cash in low-yield accounts could be costing you, and smarter alternatives that preserve liquidity while boosting returns.
-
I want to sell our beach house to retire now, but my wife wants to keep it.I want to sell the $610K vacation home and retire now, but my wife envisions a beach retirement in 8 years. We asked financial advisers to weigh in.
-
How to Add a Pet Trust to Your Estate PlanAdding a pet trust to your estate plan can ensure your pets are properly looked after when you're no longer able to care for them. This is how to go about it.
-
Nasdaq Slides 1.4% on Big Tech Questions: Stock Market TodayPalantir Technologies proves at least one publicly traded company can spend a lot of money on AI and make a lot of money on AI.
-
Fed Vibes Lift Stocks, Dow Up 515 Points: Stock Market TodayIncoming economic data, including the January jobs report, has been delayed again by another federal government shutdown.
-
Stocks Close Down as Gold, Silver Spiral: Stock Market TodayA "long-overdue correction" temporarily halted a massive rally in gold and silver, while the Dow took a hit from negative reactions to blue-chip earnings.
-
The New Fed Chair Was Announced: What You Need to KnowPresident Donald Trump announced Kevin Warsh as his selection for the next chair of the Federal Reserve, who will replace Jerome Powell.
-
If You'd Put $1,000 Into AMD Stock 20 Years Ago, Here's What You'd Have TodayAdvanced Micro Devices stock is soaring thanks to AI, but as a buy-and-hold bet, it's been a market laggard.
-
Nasdaq Drops 172 Points on MSFT AI Spend: Stock Market TodayMicrosoft, Meta Platforms and a mid-cap energy stock have a lot to say about the state of the AI revolution today.
-
S&P 500 Tops 7,000, Fed Pauses Rate Cuts: Stock Market TodayInvestors, traders and speculators will probably have to wait until after Jerome Powell steps down for the next Fed rate cut.
-
S&P 500 Hits New High Before Big Tech Earnings, Fed: Stock Market TodayThe tech-heavy Nasdaq also shone in Tuesday's session, while UnitedHealth dragged on the blue-chip Dow Jones Industrial Average.
