Wall Street stocks edged up at Wednesday’s open, as an accelerating bond rout took a breather and investors braced for the fallout from the historic ouster of the US House Speaker.
The Dow Jones Industrial Average (^DJI) turned up 0.1%, after a brutal selloff in stocks Tuesday that sent the benchmark into the red for the year. The S&P 500 (^GSPC) was up 0.3%, and the tech-heavy Nasdaq Composite (^IXIC) rose 0.4%.
The indexes suffered deeper losses earlier in the morning as US government bond yields climbed, with the 30-year Treasury yield (^TYX) reaching 5% for the first time since 2007. Yields have since tipped lower, pulling the 10-year yield (^TNX) back below 4.8%.
The selloff in stocks is all about the “pain trade” in bonds, some strategists believe, as investors increasingly accept the era of low interest rates is coming to an end. That has driven a fundamental shift in how investors think about everything from stocks to currencies, and the role bonds play in their portfolios.
Two more Federal Reserve officials on Tuesday joined colleagues in hammering home the message that rates are likely to stay high for a long time — a message that has spurred the surge in yields.
Read more: What the Fed rate-hike pause means for bank accounts, CDs, loans, and credit cards
At the same time, higher-than-expected data on job openings boosted bets for another hike this year. The next key reading on the US labor market will be the monthly payrolls print on Friday, likely to be closely watched for yet another sign the Fed has even more to do. On Wednesday, however, a report from ADP on private-sector hiring found the slowest level of job growth last month since 2021.
The historic ouster of House Speaker Kevin McCarthy on Tuesday ramped up the uncertainty in the market, given voting in a replacement likely means weeks of chaos and gridlock for other business. That heightens the odds of a US government shutdown that could disrupt the economy, with a deadline due in just weeks.
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JStocks pop at open as yields retreat
Stocks were higher and bond yields fell just after the opening bell on Wall Street as investors digested weaker than expected private payroll data for the month of September.
After a selloff on Tuesday, the Dow Jones Industrial Average (^DJI) gained 0.1% at the market open on. Wednesday. The S&P 500 (^GSPC) rose about 0.2%, while the tech-heavy Nasdaq Composite (^IXIC) popped roughly 0.4%.
Meanwhile, after reaching 16-year highs on Tuesday, 10-year (^TNX) and 30-year Treasury yields (^TYX) retreated on Wednesday. The 10-year yield sat at 4.75% after rising above 4.8% on Tuesday.
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Intel, Apple, and Palantir: Stocks trending in premarket trading
Here are some of the stocks leading Yahoo Finance’s trending tickers page in premarket trading on Wednesday:
Intel (INTC): Shares in Intel rose 2%. Intel plans to spin off its programmable chip division, which it purchased in 2015 for $17 billion.
Apple (AAPL): Apple shares fell almost 1% in premarket on Wednesday. The tech giant’s stock was downgraded by KeyBanc.
Palantir (PLTR): Shares in the data analysis firm rose 3%. It closed its UK health data contract on Wednesday.
Novartis (NOVN.SW): Novartis shares fell 4%. Sandoz, which was spun-off by Novartis, made its market debut on Wednesday with a lower-than-expected valuation of $11.2 billion.
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KStock futures steady as bond pressure eases
The major US stock indexes traded around the flatline on Wednesday, after pressure from rising Treasury yields helped drive steep losses the previous day.
Futures on the S&P 500 (^GSPC) tipped 0.09% higher, while those on the Dow Jones Industrial Average (^DJI) edged up 0.07%, or 24 points. Contracts on the tech-heavy Nasdaq 100 were up 0.1%.
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