S&P 500 Retreats As Treasury Yields Test New Highs

Settled S&P 500 Below 3700

As traders paid attention to the events in the Treasury markets, the S&P 500 fell below the 3700 mark. Treasury yields hit fresh highs today after gaining significant upward momentum. While the yield on 10-year Treasuries managed to stabilize above 4.10%, the yield on 2-year Treasuries crept closer to 4.55%.

Unsurprisingly, the U.S. dollar received significant support from higher rates. Stronger dollar and higher Treasury rates acted as stock market negative drivers.

The trading session today saw quite a few prominent losers. After lowering its full-year outlook, Generac, which develops and produces power generating equipment, saw a 25% fall. After missing analyst sales and profit expectations, M&T Bank dropped 14%.

As Treasury rates touched new highs, it should come as no surprise that REITs had the poorest performance in the market. Leading tech companies including Amazon, Microsoft, and Alphabet were all down by approximately 1% as investors continued to take gains after the recent recovery.

As WTI oil rose back over the $85 mark, energy equities including Baker Hughes, Valero Energy, Halliburton, and Schlumberger saw gains of 4–5%.

After the release of its third-quarter report, Tesla shares fell in the after-market session, reaching a low of $210. The business posted profits of $0.95 per share and sales of $21.45 billion. The next earnings call, which might significantly affect the dynamics of Tesla stock, will continue to be the focus of traders.

Following the release of its third-quarter earnings, IBM acquired significant upward momentum and climbed near $129 per share. The business said that for the whole year 2022, constant currency sales growth will exceed its mid-single digit estimate. In the post-market session, support for IBM shares came from an improvement in the expectation for sales growth.