US market declines as oil prices and treasury yields rise

Stocks faced challenges on Monday as rising oil prices and increased Treasury yields dampened market sentiment.

The Dow Jones Industrial Average fell 398.51 points, or 0.94 per cent, to close at 41,954.24. The S&P 500 decreased by 0.96 per cent, settling at 5,695.94, while the Nasdaq Composite dropped 1.18 per cent to finish at 17,923.90.

The benchmark 10-year Treasury yield rose more than 4 basis points, reaching 4.02 per cent. This marks the first time since August that the yield has exceeded 4 per cent. Oil prices also increased, driven by ongoing tensions in the Middle East, with U.S. crude climbing more than 3 per cent to settle above $77 per barrel.

Monday’s movements followed a tumultuous week for stocks, during which major averages managed to achieve modest gains. The S&P 500 rose 0.2 per cent for the week, while the Nasdaq Composite inched up by 0.1 per cent, and the Dow added 0.1 per cent.

Energy stocks, which were up about 0.4 per cent , were the only sector in the S&P 500 to finish in positive territory. In contrast, the utilities and communication services sectors lagged, both declining around 2 per cent.

Looking ahead, key releases include the Federal Reserve meeting minutes on Wednesday and the consumer price index report on Thursday. Earnings season is also set to gain momentum, with results from Delta Air Lines and JPMorgan Chase scheduled for Thursday and Friday, respectively.

In company news, Amazon shares fell 3.1 per cent after Wells Fargo downgraded its rating from overweight to equal weight and lowered its price target, citing concerns over slowing growth and increased competition from Walmart.

Apple shares fell 2.25 per cent after Jefferies lowered its rating on the Megacap tech company from buy to hold, citing that near-term expectations for the iPhone 16 and 17 are overly optimistic due to weaker-than-expected initial demand.

Futures

The SPI futures are pointing to a 0.1 per cent fall.

Currency

One Australian dollar at 7.55am was buying 67.58 US cents.

Commodities

Gold lost 0.20 per cent. Silver fell 1.37 per cent. Copper was down 0.46 per cent. Oil jumped 3.86 per cent.

Figures around the globe

European markets closed mixed. London’s FTSE added 0.28 per cent, Frankfurt lost 0.09 per cent, and Paris gained 0.46 per cent.

Turning to Asian markets, Tokyo’s Nikkei added 1.80 per cent, while Hong Kong’s Hang Seng gained 1.6 per cent and China’s Shanghai Composite was closed.

Yesterday, the Australian share market closed 0.68 per cent higher at 8205.

Dividends payable
Adairs Ltd (ASX:ADH)
Chorus Ltd (ASX:CNU)
NIB Holdings Ltd (ASX:NHF)
Orora Ltd (ASX:ORA)
Silk Logistics Holdings Ltd (ASX:SLH)
Southern Cross Electrical Engineering Ltd (ASX:SXE)
Wesfarmers Ltd (ASX:WES)
WOTSO Property (ASX:WOT)

Sources: Bloomberg, FactSet, IRESS, TradingView, UBS, Bourse Data, Trading Economics, CoinMarketCap, Marketech.
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