US stocks on Thursday fell for the third session in a row following technology stocks, as comments from the head of the US Federal Reserve System (FRS) Jerome Powell could not allay investors’ fears about the recent rise in government bond yields.
Speaking at the online conference The Wall Street Journal, Powell said he was closely monitoring the bond market, but noted that the expected acceleration in inflation this year is unlikely to last, and therefore the current monetary policy remains appropriate.
The 10-year US Treasuries jumped 7.8 basis points after Powell’s comments to 1.547%, hitting the highest close since February 19, 2020.
Back in early January, it was at 0.915%.
The number of Americans who applied for unemployment benefits for the first time last week increased by 9 thousand to 745 thousand people.
Analysts on average expected the number of applications to rise to 750 thousand from the previously announced level of the previous week, Trading Economics reported.
Labor productivity in the United States fell 4.2% in the fourth quarter, final figures from the country’s Labor Department show. The cost of labor in the United States increased by 6%.
Experts on average expected the first indicator to decline by 4.7% and the second to rise by 6.6%, according to Trading Economics.
Economic activity in most of the twelve US regions continued to grow at a modest pace from January to mid-February, according to a regional survey released Wednesday by the Federal Reserve, dubbed the Beige Book by color of the cover.
Meanwhile, the US Senate on Wednesday did not begin considering a new package of measures to support the economy in a pandemic due to changes that require a recalculation of its cost, according to USA Today.
According to an assistant to one of the Democratic senators, referred to by the publication, the upper house of the US Congress planned to hold a procedural vote on Wednesday to begin discussions on the bill.
However, the Senate is still waiting for the Congressional Budget Office (CBO) and the Joint Tax Committee to provide their estimate of the cost of the new version of the bill. Initially, the volume of the package proposed by US President Joe Biden was $ 1.9 trillion.
The Dow Jones Industrial Average by the close of the market dropped by 345.95 points (1.11%) and amounted to 30,924.14 points. Standard & Poor’s 500 fell by 51.25 points (1.34%) – to 3768.47 points. (Also Read: How to form an Investment Portfolio for a beginner – Complete Guide 2021)
The Nasdaq Composite shed 274.28 points (2.11%) to 12,723.47 points, hitting its lowest level in the last three months. The most significant losses on Thursday were the shares of the tech sector.
Tesla Inc. fell 4.9% and the ARK Innovation ETF lost 5.3%. Nine of 11 sectors of the Standard & Poor’s 500 finished trading in the red.
At the same time, the energy sector added 2.5% amid rising oil prices after the OPEC + meeting.
Amgen Inc. by the end of trading on Thursday decreased by 0.9%.
The American company announced the conclusion of an agreement to purchase the biotechnology company Five Prime Therapeutics Inc. in a deal worth $ 1.9 billion.
Five Prime shares soared 78.7%. The market value of US-based Zynga Inc. decreased by 5.5%.
The developer of popular games on social networks is buying the cross-platform games studio Echtra Games, whose team took part in the development of such well-known franchises as Diablo, Torchlight and TheSims 4, the company said.
Financial terms of the deal were not disclosed. Square Inc’s capitalization fell 6.7%.
The payment company said it had agreed to buy a majority stake in the music service Tidal, owned by renowned American rapper Jay-Z, for $ 297 million.
Walt Disney Co. fell in price by 2.2%. The company said it will close at least 60 Disney retail stores in North America this year, intending to focus more on e-commerce and reduce the number of traditional stores.
Oscar Health Inc. decreased by 7.8%. Shares of the American insurance company fell nearly 11% on Wednesday, the first day of trading in the market after the initial public offering (IPO).
Okta Inc. lost 6.2% in price. The American software developer signed an agreement to buy startup Auth0, which provides a platform for authorizing users to access applications and devices, for $ 6.5 billion.
General Motors Co. rose 1.6%. The automaker plans to build a second electric vehicle battery plant in the United States in partnership with South Korea’s LG Chem Ltd., according to the WSJ newspaper.