Stock Market Today: Nasdaq, S&P Snap Weekly Win Streaks as Tech Slumps

Stock Market Today: Nasdaq, S&P Snap Weekly Win Streaks as Tech Slumps

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.

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.

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Last modified on Monday, 22 August 2022 01:40
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