January 11, 2022

Stock Markets Continue to Plunge, US Yields Continue to Soar

 The Wall Street stock market continued to post declines despite a slight rise late yesterday (Monday) as investors continued to contain sentiment concerns about a rate hike by the Federal Reserve (Fed) by March this year.

Investors continued to reduce their holdings of risky assets and caused the US 10 -year treasury yield to soar to a 2 -year high.

In addition, signals by the Fed regarding faster policy tightening to tackle inflation and strong US labor market data were among the downside factors on Monday.

The Dow Jones Industrial average was down 0.45%, the S&P 500 was down 0.14%and the Nasdaq Composite, a technology stock that has soared in the last 2 years due to low interest rates, was down 0.05%.

The pan-European STOXX 600 index was down 1.48% and the global MSCI stock gauge was down 0.26%.

According to Arthur Hogan, head of market strategy at National Holdings Corp., he suggests investors put money in financial, industrial and energy stocks as it is likely to benefit from strong economic growth in the coming months.

The US 10 -year treasury yield note rose 1.8080% which is the highest level since 2020 then retreated slightly to 1.7603%.

The dollar index was up 0.17% at 95.957 while the Euro was down 0.28% at $ 1.13270.

Oil prices fell but maintained gains by 5% last week following supply disruptions due to unrest in Kazakhstan and Libya where US crude oil prices fell 0.85% at $ 78.23 a barrel and Brent oil fell 1.1% at $ 80.87.

Bitcoin was down 0.21% at $ 41,788.27.