The New York Stock Exchange opened lower on Tuesday, hit by a new sign of vitality from American consumers, raising fears of greater monetary tightening by the Federal Reserve (Fed).
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At around 1:55 p.m. GMT, the Dow Jones was down 0.28%, the Nasdaq index was down 1.35% and the broader S&P 500 index was down 0.79%.
The market tightened after the release of retail sales in the United States, which posted a one-month increase of 0.7% in September, well above the 0.3% forecast by economists.
In addition, the previous two months of July and August were revised upwards.
Even the core index, excluding the most volatile components, namely energy, building materials, automobiles and food, rose 0.6%, against expectations for just 0.1%.
“Everyone expects consumers to slow down, but if they maintain this pace, the likelihood of the Fed raising interest rates in December increases,” commented Quincy Krosby of LPL Financial.
The daily statistics pushed up bond interest rates, which had already started rising again on Monday thanks to the return of risk appetite.
The two-year Treasury yield, which best reflects Wall Street’s monetary policy expectations, was 5.17%, down from 5.09%, not far from its closing 17-year high (5.19%). September.
Prices at 10 made an even more significant increase to 4.84% compared to 4.70% the previous day at the close.
“Bond market moves are putting a little more pressure on stocks,” Patrick O’Hare of Briefing.com noted in a note.
Huge capitalizations in the technology sector are struggling to cope with this new rise in bond yields, which is reducing the attractiveness of their future earnings.
Particularly affected was Nvidia, the graphics processor specialist that enjoys great popularity in so-called generative artificial intelligence (-6.83%), as well as the semiconductor manufacturers AMD (-3.67%), Intel (-3.88%) or Broadcom (-3.30%).
Inspired by the consumption figures, the department store brand Macy’s (+2.65%) and the supermarket chain Target (+0.66%) were in the green.
Bank of America rose (+0.31%) after quarterly results beat expectations. The institution offset lower profits from asset management and retail banking with business services and market activities.
In the same sector, Goldman Sachs fell (-1.41%) despite better-than-expected results despite over a year of declines. The New York brand particularly benefited from the revival of investment banking and managing director David Solomon said he expected a recovery in capital markets.
Johnson & Johnson, which even raised its annual forecasts but was avoided by investors (-0.11%), also exceeded analysts’ estimates. The New Brunswick (New Jersey) laboratory was driven by the American market (11% growth over one year).
Lockheed Martin (+1.87%) benefited from results above group-wide expectations, although aviation activities disappointed. The Bethesda (Maryland) company specifically mentioned reduced production of the F-35 fighter jet.
The hotel group Wyndham Hotels & Resorts recovered (+11.43%) after its competitor Choice Hotels (-4.21%) announced a takeover offer at a 30% higher price on Monday evening. The proposal values Wyndham at $9.8 billion, including debt.