NEW YORK, United States: The S&P 500 fell 0.58% Thursday as surging oil prices and rising Treasury yields increased inflation concerns ahead of next week’s Federal Reserve meeting.
The benchmark closed at 7,591.75, while the Nasdaq Composite dropped 0.65% to 26,081.73. The Dow Jones Industrial Average fell 0.60% to 52,064.10, according to Reuters.
Brent crude climbed about 6% to USD 107 a barrel as supply routes through the Strait of Hormuz and Red Sea faced disruption from the U.S.-Israeli war on Iran.
Meanwhile, the 10-year Treasury yield reached its highest level in nearly three years. The 30-year yield rose to its highest in more than 19 years, while the two-year yield hit a more than two-year high.
Read: Brent Crude Tops $100 as Iran-US Tanker Attacks Widen
Ross Mayfield, investment strategy analyst at Baird, said higher yields pressure equity valuations while raising financing costs for companies and consumers.
Heavyweight chipmakers also declined. Nvidia fell 2.3%, and Micron Technology lost 4.7%, while Apple rose 3.6% a day after launching a USD 1,999 folding iPhone.
Read: Treasury Bond Buyback Raised to $6 Billion as Yields Rise
CME FedWatch data showed traders assigning a 70% probability to a Federal Reserve rate increase of at least 25 basis points next week, up from about 64% before Thursday’s data.
