Stocks ended the week on a downward note as rising Treasury yields and concerns over China’s property market weighed on investor sentiment. Despite a slight uptick in the Dow Jones Industrial Average, it was still a challenging week for equities across the board.
Market Recap
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The Dow Jones Industrial Average (DJIA) rose slightly by about 27 points or 0.1% to close near 34,501, according to preliminary FactSet data.
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The S&P 500 index remained nearly flat at 4,370.
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The Nasdaq Composite Index experienced a slight decline of 0.2%, despite briefly turning positive in late-session trading.
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Overall, this week saw losses across major indices with the Dow booking a 2.2% loss, the S&P 500 index declining by 2.1%, and the Nasdaq experiencing a 2.6% drop.
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Additionally, the Nasdaq recorded its largest three-week decline since December 2022, signaling ongoing market turbulence.
Treasury Yields Surge
Continuing a five-week trend, yields on the benchmark 10-year Treasury rose once again. The TMUBMUSD10Y rate briefly reached its highest level since November 2007 before settling back at 4.251% on Friday. This spike in yields has contributed to the overall unease in the markets.
China’s Property Market Concerns
China Evergrande’s Chapter 15 bankruptcy filing in New York on Thursday kept investors focused on the country’s unstable property market. Earlier in the week, Country Garden Group also missed a dollar-denominated debt payment, further adding to anxieties surrounding China’s second-largest economy.
Looking Ahead
The upcoming week will be marked by anticipation for Federal Reserve Chairman Jerome Powell’s speech at the Jackson Hole economic summit. Investors will be closely watching for any hints regarding the central bank’s future rate hikes. Currently, the Fed’s policy rate stands at its highest level in 22 years.
Even though this week has been challenging for the stock market, investors are preparing for potential shifts and seeking guidance from key economic indicators and central bank actions.
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