Yesterday the market was worried about artificial intelligence. Today it went back to worrying about interest rates, which have a much longer track record.
The Dow Jones Industrial Average (DJINDICES: ^DJI) dropped 0.7% as of 1:16 p.m. ET, with the Nasdaq Composite (NASDAQINDEX: ^IXIC) matching it. The S&P 500 (SNPINDEX: ^GSPC) took a lighter hit, falling 0.4%. Only seven of the Dow’s 30 stocks posted gains at this checkpoint.
Missed Nvidia in 2009? This Rare Signal Is Flashing Again. In 2009, a “Double Down” signal flashed for a little-known chipmaker called Nvidia. For the first time in years, that same “Total Conviction” signal is flashing for a company 1/100th the size of Nvidia. Continue »
Treasury yields just hit a 19-year high
The 10-year Treasury yield climbed to 5.041% on Tuesday morning, a level not seen since July 2007. The 30-year hit 5.401%, setting another 19-year record, and 30-year mortgage rates crossed 7% last week. These numbers can reprice everything from car loans to corporate borrowing.
Oil kept pushing in the same direction. Brent crude rose 2.6% to $108.41 and U.S. crude added 3.3% to $104.76 while traders tried to figure out how long Saudi Arabia’s East-West oil pipeline stays offline.
Energy Secretary Chris Wright says days. Oil analyst Andy Lipow, looking at satellite photos of the wrecked pumping station, says months. Someone will be wrong, and real-world oil prices will eventually set the record straight. The United States Oil Fund (NYSEMKT: USO) gained 4.1% today.
Monday’s AI panic mostly unwound. Nvidia edged higher, Qualcomm rose 4%, and Advanced Micro Devices gained 2.3%. The chip wreck has stopped at least for today, and the indexes fell anyway.
The damage just moved to a different corner of Wall Street. Goldman Sachs (NYSE: GS) fell 2.9% and took 171 Dow points with it, easily the day’s biggest single drag, and JPMorgan Chase (NYSE: JPM) dropped 1.6%. Big tech joined in, with several Magnificent 7 names falling 1% or more. Some of them had more than macroeconomic concerns, though. Amazon (NASDAQ: AMZN) lost access to cloud computing centers in Bahrain and the UAE due to irreparable damage from the Iran war. Apple (NASDAQ: AAPL) faces a regulatory review of its software warranty policy in India.
Chevron (NYSE: CVX) was about the only place to hide among the Dow components, posting a 2% gain. That’s another sign of rising oil prices.
What to listen for when Kevin Warsh takes the podium tomorrow
The Fed wraps up its meeting on Wednesday, and futures give a quarter-point hike better than 92% odds. So the decision isn’t really the news. What Chair Kevin Warsh says about the meetings after this one is.
