Stocks fell Thursday, deepening losses for the week, as Treasury yields climbed to multiyear highs amid the Federal Reserve’s plan to keep interest rates at higher levels for longer.
The Dow Jones Industrials plunged 119.88 points to 34,321.
The S&P 500 index stumbled 37.45 points to 4,364.75.
The NASDAQ index weakened 166.38 points, or 1.2%, to 13,302.75,
Through Thursday’s open, the Dow was set to end the week down about 1%, the S&P 500 was on track to close the week off about 2%, while the NASDAQ was poised to fall more than 3%.
The 10-year Treasury yield hit 4.48%, its highest in more than 15 years, with the latest catalyst being weekly jobless claims data showing a still strong labor market that could encourage the Fed to stay in hiking mode. Weekly jobless claims decreased by 20,000 to 201,000 for the week ending Sept. 16, much lower than the 225,000 claims expected by economists polled by Dow Jones. It was the lowest volume of new unemployment claims since January.
The moves come a day after the Federal Reserve said it would leave interest rates unchanged, but forecasted another rate hike before the end of the year. The central bank also indicated fewer rate cuts next year, essentially saying it would need to keep rates higher for longer because stubborn inflation.
Tech shares have led the losses this week as investors rethink buying growth-oriented stocks if interest rates remain high. Tesla, Alphabet, Meta Platforms and Nvidia were among those lower Thursday.
Marketing automation firm Klaviyo, which debuted on the public markets Wednesday, slipped 3% Thursday. That made the stock the latest in a string of promising IPOs that turned lower this week.
FedEx bucked the negative trend, gaining more than 6% after the delivery company posted adjusted earnings of $4.55 per share in its fiscal first quarter, while analysts called for $3.73 per share, per LSEG.
Prices for the 10-year Treasury slumbered, raising yields to 4.47% from Wednesday’s 4.39%. Treasury prices and yields move in opposite directions.
Oil prices took on 73 cents to $90.39 U.S. a barrel.
Gold prices skidded $29.50 to $1,937.60 U.S. an ounce.