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Dow adds 100 points to snap 3-day losing streak as Treasury yields ease from 16-year highs: Live updates

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The Dow Jones Industrial Average broke a three-day losing streak Wednesday as Treasury yields pulled back from multiyear highs following the release of much weaker-than-expected jobs data.

The 30-stock index gained 127.17 points, or 0.39%, to close at 33,129.55. The S&P 500 added 0.81% and closed at 4,263.75. Meanwhile, the Nasdaq Composite gained 1.35% at 13,236.01.

Within the S&P 500, consumer discretionary was the best-performing sector, rising about 2%. Tesla and Norwegian Cruise Line led the sector gains, adding 5.9% and 3.8%, respectively.

Energy was the index's worst-performing sector Wednesday as crude prices had their single largest day of losses back to September 2022. Devon Energy and Marathon Oil each fell roughly 5%, while SLB and Halliburton both dropped more than 4%.

Wednesday's moves follow the release of new jobs data. ADP said 89,000 private payrolls were added last month. That's well below a Dow Jones forecast of 160,000 and fewer than an upwardly revised 180,000 payroll additions from August.

Treasury yields pulled back slightly from their 2007-level highs on the data. The 10-year Treasury yield was last trading at 4.735%.

"Anytime you have big momentum in one direction, there's going to be days where you get a little bit of reprieve and in this case, you get a reprieve in rates and equities. The broader trend is really the downside from here," said Ross Mayfield, investment strategy analyst at Baird.

Higher interest rates have increased fears of a recession and have pushed mortgage rates near 8%. Consequently, mortgage demand fell to its lowest levels since 1996.

"The market is being dragged around by interest rates," said Harris Financial Group managing partner Jamie Cox. "[We're] seeing a divergence — a big difference — between fixed income and equities," he added.

Investors remain on edge and are looking toward Friday's release of September's nonfarm payrolls data for more indications on the strength of the labor market.

The data comes on the back of a losing session on Wall Street after job openings data indicated the labor market is still strong and bond yields marched higher. The yields on the 10-year and 30-year Treasurys reached their highest levels since 2007. Meanwhile, the Dow notched its worst session since March and turned negative for the year.

"I don't think you get a broader [rally] participation until rates ease up, and that's only if rates ease without some sort of financial crisis or hard landing recession," Mayfield said. "Every day that we're this high on rates [and] every basis point deeper into restrictive territory, probably reduces the odds of a soft landing in 2024."

Stocks end Wednesday's trading session in the green

U.S. stocks closed higher on Wednesday.

The Dow Jones Industrial Average added 127.17 points, or 0.4%, to close at 33,129.55. The S&P 500 gained 0.81% at 4,263.75. The Nasdaq Composite rose 1.35% at 13,236.01.

— Hakyung Kim

This could be a good entry point for utilities, strategist says

Andrew Smith, chief investment strategist at Delos Capital Advisors in Dallas, told CNBC that he is adding exposure to utilities even though his portfolio was already positioned defensively.

"We believe that this move in rates, while it still might go a little higher, the defensive side ... still makes sense," Smith said.

The strategist pointed out that the recent drop for utilities has taken the sector to its lowest level in more than three years, and that real rates are now positive.

"That makes this an attractive entry point for us as we rebalance," Smith added.

The Utilities Select Sector SPDR Fund (XLU) was down less than 1% on Wednesday afternoon.

— Jesse Pound

Bill Gross is bearish on both stocks and bonds

Bill Gross, a widely followed investor once known as the bond king, said he's negative about both stocks and bonds, only seeing very limited opportunities in the market.

"I'd pass on stocks and bonds in terms of future total returns," Gross, the former chief investment officer and co-founder of Pimco, wrote in his new investment outlook blog.

The 79-year-old investor did point to a few opportunities, however. Click here to read more.

— Yun Li

The market will end 2023 with both lower rates and stocks, says Carter Worth

Worth Charting CEO Carter Worth is going against consensus by betting on a weakening dollar and falling interest rates and oil prices.

"I think when you get so much crowding and the sequence calls for a counter trend, try to play for it," Worth told CNBC's "The Exchange" on Wednesday. "My judgment is the timing here is to be buying bonds and to be fading the dollar."

Generally, declining interest rates boost stock prices, so Worth's forecast could provide fuel for the investors who predict a year-end stock market rally. But Worth cautioned that asset class relationships aren't always perfectly inverse, and believes instead that the market will end up with both lower rates and lower stocks at the end of 2023.

— Lisa Kailai Han

Ned Davis sentiment indicator flashing sign of potential big gain ahead

Investor pessimism on stocks is at levels that in the past have been consistent with big buying opportunities, according to Ned Davis Research.

In a client note Wednesday, the firm said its Daily Trading Sentiment Composite is in its "extreme pessimism zone," a condition that since 1994 has preceded an average 26.7% annualized gain, with positive returns 80% of the time.

One caveat: Investors are negative on both stocks and bonds. A potential consequence is a "full risk-off environment" that sees a rally in bonds and further decline in stocks, leading to a capitulation on equities and a year-end rally, the note said.

—Jeff Cox

Rate uncertainty drove Tuesday’s selloff, but there is a limit to how high yields will go, says Vanguard’s Aliaga-Diaz

Tuesday's run-up in bond yields spooked investors, but the move is a side effect of markets transitioning to the new reality of higher interest rates, said Roger Aliaga-Diaz, global head of portfolio construction in Vanguard's investment strategy group.

More than a year into the Federal Reserve's policy tightening campaign, interest rates are likely to settle at a higher point compared to the pre-pandemic era, he said.

"The neutral policy rate is now higher on a permanent basis, perhaps 3.5% or 4%, and that gives you a higher floor for the 10-year bond compared to previous years," Aliaga-Diaz told CNBC.

That adjustment results in two outcomes. "One it's very painful on the front end because things are resetting to these higher rates," he said. "And [two] you have the market digesting this news over the past few weeks."

Aliaga-Diaz noted that while the central bank has communicated that rates will stay higher for longer, there's also an implicit cap as to how high those rates will go. "It could be because of uncertainty and volatility that you can see higher 4 and even 5%," he said, regarding the 10-year Treasury yield. "But we don't see that as a permanent level of rates."

-Darla Mercado

Global household financial assets dropped last year but are set to recover, says Allianz

Global private households saw a 2.7% drop in their financial assets in 2022, which is the strongest drop since the global financial crisis in 2008, according to the latest Allianz Global Wealth report.

Globally, these households saw securities decline by 7.3%, insurance and pensions drop by 4.6% and bank deposits add 6%. The decline was most pronounced in North America, followed by Western Europe, according to Allianz. More specifically, gross financial assets of U.S. households declined by 6.4% in 2022.

The firm noted that global household financial assets are still 19% above pre-Covid levels, and should return to growth in 2023 after last year's decline.

— Pia Singh

Bond selling looks overstretched, AmeriVet's Faranello says

The benchmark 10-year Treasury yield hit a fresh 16-year high earlier in the session, trading at nearly 4.9%. However, AmeriVet Securities head of U.S. rates strategy Gregory Faranello, thinks the rise in yields may pause in the near term.

"The market short term is probably overstretched," he said, noting that it's still possible for the 10-year to climb to 5%. "Could we see 5% on 10s? Sure, but we'll have to do some work to get there."

— Fred Imbert

Oil hits lowest level since Sept. 5

Futures for West Texas Intermediate crude hit their lowest level since Sept. 5 on Wednesday, falling more than 4% to trade below $86 per barrel.

Brent crude futures have also dropped more than 4% to the lowest level since Sept. 1, while RBOB Gas futures are down 5.8% to their lowest level this year.

Meanwhile, the United States Oil Fund (USO) is down more than 4% and on track for its worst day since May.

— Gina Francolla, Jesse Pound

Stocks making the biggest moves midday

Check out the companies making headlines in midday trading.

  • Sunnova EnergySunrun — Sunnova Energy and Sunrun dropped 5.4% and 6.5%, respectively, to trade near 52-week lows after Truist downgraded the solar stocks to hold from buy ratings, citing near-term concerns from elevated interest rates.
  • Cal-Maine Foods — Shares slipped 6.6% after the egg producer provided a weak earnings report, citing a dynamic market environment. The company reported fiscal first-quarter earnings of 2 cents per share, missing the consensus estimate of 33 cents per share from analysts polled by FactSet.
  • DexCom, Insulet — Diabetes names DexCom and Insulet fell 5% and 3%, respectively, after a study released Tuesday suggested a class of popular weight loss drugs GLP-1 could impact the need for basal insulin. Separately, Insulet said on Tuesday that Wayde McMillan would step down as chief financial officer.

Read the full list here.

— Sarah Min

Technology and software ETF on pace for best day since August

The iShares Expanded Tech-Software Sector ETF rose more than 1.4% on Wednesday, putting it on pace for its best day since Aug.29 when it rose more 1.94%.

The fund's biggest winners included Palantir Technologies and Applovin, last up 4.1% and 3%, respectively. GitLab, UiPath, Zscaler and RingCentral rose more than 2%. Oracle, Adobe, Palo Alto Networks, and Intuit gained nearly 2% each.

— Samantha Subin, Gina Francolla

Volatility index retreats

Wall Street's fear gauge took a breather on Wednesday.

The Cboe Volatility Index, which rises when investors expect market turmoil ahead, fell by nearly 1 point in Wednesday's session to under 19. On Tuesday, the index hit a high above 20 not seen since May amid the market sell-off.

— Alex Harring

What McCarthy's ousting means for the market

The ousting of Republican Kevin McCarthy as House Speaker may not have any major immediate implications for Wall Street, but it could boost the likelihood of government shutdown in the fourth quarter.

Wall Street ways in on what it means for already volatile equity markets here.

— Samantha Subin

Mizuho says Coinbase will miss third-quarter revenues by 10%

Mizuho is lowering its revenue estimates for Coinbase following a seasonally weak quarter that was further pressured by low trading volumes. The firm said it expects the crypto exchange's third-quarter revenue to come in 10% below current consensus expectations, in a note to investors Wednesday.

The cryptocurrency market this year has been plagued by low volatility and diminished liquidity. In August, bitcoin trading volatility fell to its lowest level in more than four years as investors had been waiting on the sidelines for more regulatory clarity on crypto activity – whether through new legislation out of Congress or through the ability to launch a spot bitcoin ETF.

— Tanaya Macheel

Chevron slides more than 2%

The drop in oil prices appeared to be weighing on the Dow on Wednesday.

Energy giant Chevron was the worst performer in the 30-stock average, falling 2.4%.

Other laggards in the Dow include Caterpillar, down 1.6%, and Walgreens Boots Alliance, off by 2.1%.

— Jesse Pound

Biotechnology ETF notches new 52-week low

The SPDR S&P Biotech ETF (XBI) hit a new low not seen in more than a year on Wednesday.

The fund fell nearly 2% in the session. Cabaletta Bio led the fund down with a drop of more than 13%. Novavax was the next worst performer with a loss of more than 7%, followed by Revolution Medicines and Avidity Sciences, which have both shed more than 6%.

With the losses, the ETF hit its lowest level since June 2022. If the leg down holds, it will mark the fifth straight losing session.

Arcturus Therapeutics and Sana Biotechnology were among stocks able to buck the slide, with shares of both names up about 2% in the session.

— Alex Harring, Gina Francolla

Oil falls to three-week low, potentially easing inflation fears

Benchmark oil prices fell to three-week lows on Wednesday, assuaging some worry over persistent inflation.

Global benchmark Brent slipped 3.6% to $87.58 per barrel, while West Texas Intermediate pulled back 3.7% $87.61. Crude price are coming off highs above $95 per barrel in September, driven by supply worry due to continuing output cuts from Saudi Arabia and oil cartel OPEC.

Industry data from the Energy Information Administration Wednesday said crude inventories at Cushing, Oklahoma facility ticked up by 132,000 barrels last week.

— Brian Evans

Natural gas reaches highest level since January

Natural gas hit a high of $3.055, marking its the highest level since Jan. 27, when it traded as high as $3.176.

Prices climbed on lower output, as well as forecasts for cooler weather and rising exports.

— Hakyung Kim, Gina Francolla

Services gauge comes in roughly in line for September

The ISM nonmanufacturing index came in at 53.6 for September, slightly below a StreetAccount forecast of 53.7. To be sure, that's below the August reading of 54.5.

"There has been a slight pullback in the rate of growth for the services sector, which is attributed to slower rates of growth in the New Orders and Employment indexes. The majority of respondents remain positive about business conditions; moreover, some respondents indicated concern about potential headwinds," said Anthony Nieves, Chair of the Institute for Supply Management Services Business Survey Committee, in a statement.

— Fred Imbert

Is the Tuesday reversal for utilities a reason for optimism?

Beaten down utility stocks enjoyed an intraday rally on Tuesday that could be a sign the market sell-off has reached exhaustion, at least for now, according to Wolfe Research.

"At the sector level, Utes posted a very nice intraday reversal, rallying 3.5% from their morning lows to close up 1.2%. Is the downside leader suggesting that the worst is over for now," analyst Rob Ginsberg said in a note to clients.

The comeback for utilities comes after the sector's sell-off hit historic levels on some technical metrics earlier in the week.

— Jesse Pound

Stocks open in the green on Wednesday

U.S. stocks opened slightly higher Wednesday.

The Dow Jones Industrial Average ticked up 63 points, or 0.2%. The S&P 500 and Nasdaq Composite added 0.2% and 0.3%, respectively.

— Hakyung Kim

Bank of America says BlackRock can outperform on fixed income gains, iShares growth

Bank of America says BlackRock will continue to make steady gains in fixed income and grow its iShares ETF segment.

The firm reiterated a buy rating on BlackRock stock in a Tuesday note, but slightly lowered its price target.

"We expect reacceleration in LT net flows in 4Q23 and for BLK's annualized organic growth rate to be between +4% and 5% in 2023 (vs. +4% in 2022) and +6% in 2024," analyst Craig Siegenthaler said

CNBC Pro subscribers can read the full story here.

— Brian Evans

Gasoline futures fall to five-month low in early Wednesday trading

Benchmark November RBOB gasoline futures fell to $2.30 a gallon early Wednesday, the lowest since May 4 when contracts got to $2.25. (RBOB stands for Reformulated Blendstock for Oxygenate Blending).

By contrast, November West Texas Intermediate futures contracts only dropped to their lowest since Sept. 12 in early trading, while global benchmark December Brent fell to its weakest Sept. 5.

The American Automobile Association national average for a gallon of gas dropped five cents from a week ago, three cents from a month ago and two cents from a year ago.

— Scott Schnipper, Gina Francolla

Private payroll growth slowed sharply in September, ADP says

Private payrolls grew by just 89,000 in September, well below the 160,000 estimate and down from 180,000 the previous month, ADP reported Wednesday.

Wages accelerated at a 5.9% annual pace, the 12th straight monthly decline, the payroll processing firm said in a report that provides some counterweight to the idea of a still-right labor market that is pushing the Federal Reserve to keep policy restrictive.

Job growth was confined mostly to the services sector, in particular leisure and hospitality. Professional and business services, trade, transportation and utilities and manufacturing all posted declines.

—Jeff Cox

These are the companies making the biggest moves premarket:

Check out the companies making headlines before the bell.

  • Intel — Shares popped 2.5% after the chipmaker announced it would be operating its programmable chip unit as a standalone business complete. Intel plans to conduct an initial public offering for the unit within the next two to three years.
  • Apple — The iPhone maker shed 0.9% after KeyBanc cut its rating on Apple to sector weight from overweight late Tuesday, citing shares' high valuation and an expectation for soft growth in the United States.
  • Cal-Maine Foods — The stock plunged 11.6% after the company came out with disappointing sales figures due to lower prices. The egg producer reported fiscal first-quarter earnings of two cents per share, while analysts polled by StreetAccount had called for earnings of 33 cents per share. Revenue was also lackluster.

Read here for the full list.

— Pia Singh

UBS initiates coverage of freelance services stock on job listings lead

UBS thinks this freelance services stock can grow as job listings gain steam heading into 2024.

"We are projecting growth to begin reaccelerating in 2024, albeit at below historical seasonality levels through 2025," analyst Kunal Madhukar said in a Tuesday note.

CNBC Pro subscribers can read the full story here.

— Brian Evans

Moderna shares jump on positive trial results

Moderna shares gained 1.6% in premarket trading after the company announced positive interim results from the Phase 1/2 trial of mRNA-1083, an investigational combination vaccine against influenza and Covid. 

The pharmaceutical giant plans to begin a Phase 3 trial of the combination vaccine in 2023, working to accomplish potential regulatory approval in 2025, according to Moderna's Wednesday morning press release.

— Pia Singh

UBS upgrades key construction and engineering stock, forecasts 36% upside

UBS upgraded a key construction and engineering company and said the firm has reached a key inflection point.

"We see the next year ahead as the proof that the turnaround will translate into higher and more normalized earnings," analyst Steven Fisher said on Wednesday. "The stock has had a nice run from the bottom, but the prices have fairly reflected the risks to date; we think the stock price today reflects the company today, but not its potential over the next 1-2 years."

CNBC Pro subscribers can read the full story here.

— Brian Evans

Stock market struggles likely to continue, says Barclays

Barclays strategist Emmanuel Cau sees stocks struggling in the near term, as rising Treasury yields rattle Wall Street.

"Surging real rates and a stronger dollar are unfriendly to risk assets. Absent a circuit breaker to the bond market, equities may continue to struggle, as rising x-asset volatility prompts more de-risking and cash is the only place to hide," Cau wrote Wednesday.

"The growth-policy trade-off is tricky, as policy transmission works with a lag, so central banks are unlikely to blink in a hurry, unless something breaks. Meanwhile, markets are starting to pay attention to fiscal risks, which means pressure on sovereign yields may be here to stay," he said.

— Fred Imbert, Michael Bloom

Yen strengthens after touching weakest levels in a year

The Japanese yen strengthened against the greenback after briefly touching 150 overnight.

In response to reporter questions, Japan's Finance Minister Shunichi Suzuki said he will not comment on whether or not there was any intervention to prop up the yen. He added that Japan will take steps against any dramatic moves in the currency "without ruling out any options."

The yen is currently trading at 149.18 against the U.S. dollar.

The last time Tokyo intervened to buy yen was in September and November 2022 when the currency sank to a 32-year low.

— Lee Ying Shan

Jeffrey Gundlach says the bond market is sending recession warning

DoubleLine Capital CEO Jeffrey Gundlach directed investors to a phenomenon in the bond market, which he believes marks a recession warning.

The spread between the 2-year and 10-year Treasury yields tightened to 35 basis points, compared to a gap of 108 basis points a few months ago, Gundlach pointed out. This "de-inverting" of the key part of the yield curve could be a tell-tale sign that an economic downturn is imminent.

"Should put everyone on recession warning, not just recession watch," Gundlach said in a post on X, formerly known as Twitter. "If the unemployment rate ticks up just a couple of tenths it will be recession alert. Buckle up."

The 2-year and 10-year Treasury yield curve initially inverted in March 2022, a phenomenon that has historically been a reliable recession predictor. It typically takes nearly two years for a recession to occur.

— Yun Li

Bill Gross says the surging 10-year Treasury yield could test 5%

Bill Gross, the former chief investment officer and co-founder of Pimco, believes the 10-year Treasury yield could shoot even higher in the short run.

"I think we're gonna go to five [percent]," Gross said on CNBC's "Last Call" Tuesday, referring to the 10-year Treasury yield. "The market certainly is oversold at the moment in anticipation of Treasury supplies, in anticipation of higher for longer in terms of the Fed."

— Yun Li

Stocks and bonds sold off Tuesday, and the 60/40 portfolio took a hit

Both bonds and equities sold off on Tuesday, and the 60/40 portfolio felt the pain keenly.

The iShares Core Growth Allocation ETF (AOR), which reflects a portfolio allocation of 60% in equities and 40% in fixed income, dropped 1.14% on Tuesday.

The portfolio suffered a total return of -15.6% in 2022 as both stocks and bonds declined sharply.

A difficult day in the market – or a rough year like 2022 – doesn't necessarily negate the long-term prospects of the 60/40 model.

Rather than provide blockbuster returns, the portfolio is intended to give investors diversification and smooth the price volatility you would otherwise see in stocks. However, during a day in which both equities and fixed income suffer, the 60/40 portfolio will also take a tumble.  

Darla Mercado

Cal-Maine drops nearly 12% following weaker-than-expected financial report

Cal-Maine Foods fell nearly 12% in extended trading after posting an earnings report that underwhelmed analysts.

The egg distributor said it earned 2 cents per share in the fiscal first quarter, well below the consensus estimate of 33 cents per share from analysts polled by FactSet. Cal-Maine also missed Wall Street's expectations for revenue in the quarter, posting $459.3 million while the average analyst had forecasted $479.5 million.

Management cited "dynamic" market conditions, noting egg prices have normalized as supply has started to recover.

— Alex Harring

Dow Transports closes below its 200-day moving average, a first since June

The Dow Jones Transportation Average ended the day below the 200-day moving average on Tuesday, a move that may portend a downtrend from here.

It was the first time the Dow Transports closed below that threshold since June 1. The 20-stock Dow Transports fell 0.78% as stocks sold off broadly and bond yields surged on Tuesday.

In all, 13 of the stocks comprising the index are below their 200-day moving average, including Union Pacific, CSX, Norfolk Southern and Southwest Airlines.

The 200-day moving average is an important indicator for market technicians, as it details long-term trends for a given asset or index. In this case, a close below the 200-day could suggest further declines ahead.

Darla Mercado, Gina Francolla

Chance of a quarter-point hike at next Fed meeting rose to 31% from 16% a week ago

The chance of a quarter-point increase to 5.50%-5.75%in the Fed's benchmark overnight lending rate at the central bank's next policy meeting on Nov. 1 rose to 30.9% Tuesday, up from 16.4% last week, according to the CME FedWatch tool.

The probability that rates will rise from the current 5.25-5.50% — derived from 30-day fed funds futures prices — rose after stronger-than-expected jobs opening numbers for August were reported by the Bureau of Labor Statistics.

— Scott Schnipper

Stock futures are little changed

Stock futures traded near flat Tuesday night.

Dow futures slipped just around 0.1% shortly after 6 p.m. ET, while S&P 500 and Nasdaq 100 futures were both marginally below flat.

— Alex Harring

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