(CercleFinance.com) – After opening on a hesitant note, Wall Street plunged into the red on Wednesday, once again weakened by tensions on the bond market after the announcement of solid real estate statistics.
At the end of the morning, the Dow Jones fell 0.1% to 33,117.2 points, while the Nasdaq Composite dropped 1.5% to 12,943.2 points, thus falling back below the threshold of 13,000 points.
U.S. Treasury bond yields rose again following a Commerce Department report showing the residential real estate sector rebounded strongly last month.
Sales of new individual homes increased by 12.3% in September to an annual volume of 759,000 units, a figure well above economists’ expectations of 682,000.
This statistic shows that the American economy is resisting the rise in interest rates and that further monetary tightening by the Fed could be necessary in order to cool both activity and inflation.
As a result, the yield on ten-year US government bonds has risen above the 4.90% mark, to once again approach the 5% level which was reached at the start of the week.
The rise in bond yields does not benefit the dollar, which remains stable against the euro at around 1.0590.
Mixed company performances have also dampened investor optimism, with many hopes pinning on this current earnings season.
Alphabet, Google’s parent company, lost more than 8% in early trading in the wake of performance considered disappointing in the ‘cloud’ in the 3rd quarter.
Conversely, Microsoft gained almost 3% after reporting yesterday evening an acceleration in the growth of its results in the third quarter thanks to the good performance of its activities in the ‘cloud’.
Oil prices fell slightly on the NYMEX following the announcement of a slight increase in crude oil stocks in the United States last week.
The December delivery contract for American light crude (West Texas Intermediate, WTI) is currently losing 0.7% to around $83.1 per barrel.
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