U.S. stocks got battered on Tuesday in a volatile start to the holiday-shortened trading week as rising bond yields, persisting rate pressures and an earnings miss by Goldman Sachs weighed on markets.
The Dow Jones Industrial Average lost more than 540 points and the tech-heavy Nasdaq shed 2.6%, recording its lowest close since October as Wall Street continued to weigh the likelihood of sooner-than-expected interest rate hikes by the Federal Reserve. The S&P 500 was also deep in the red, rounding the session out at a 1.8% loss. Meanwhile, the yield on the benchmark 10-year Treasury rose to its highest level in two years — up to 1.865%
The sell-off is “a continuation of what we’ve been seeing so far this year — it’s all about interest rates,” David Lefkowitz, head of equities for the Americas at UBS Global Wealth Management told Yahoo Finance Live. The rise in the 10-year yield “has big implications for the internals of the market.”
Wall Street was closed on Monday in observance of Martin Luther King Jr. Day but resumed trading Tuesday amid a flurry of corporate results unveiled ahead of the session: Goldman Sachs (GS), PNC Bank (PNC) and Bank of New York Mellon (BK) released earnings reports for the last three months of 2021 before market open.
Goldman Sachs (GS) reported fourth-quarter earnings that fell below analyst expectations — reflecting a decline in profit for the last three months of the year due to weakness in its trading arm, adding to a lackluster lineup of recent bank results. Shares of Goldman Sachs were down 8.3% in intraday trading to $349.30 a piece.
