Wall Street closed a volatile week mixed on Sept 18 as benchmark US Treasury yields climbed above 5% and crude oil remained above US$100 per barrel, keeping inflation and further Federal Reserve (Fed) rate hikes firmly in focus.
According to Reuters, the Dow Jones Industrial Average fell 95.40 points, or 0.18%, to 51,682.64, while the S&P 500 gained 0.17% to 7,650.50. The Nasdaq Composite rose 0.40% to 26,522.55, supported by gains in semiconductor stocks.
For the week, the S&P 500 finished marginally lower, while the Nasdaq posted a gain. The Dow suffered its biggest weekly percentage decline since March.
Markets were driven by several competing forces, led by the Fed’s latest interest-rate increase, surging Treasury yields and persistent inflation concerns linked to elevated energy prices.
Crude oil eased from its session highs but remained above US$100 a barrel, raising concerns that higher fuel and diesel costs could feed through to transport, farming and shipping expenses.
Expectations for another Fed move also increased. Financial markets are pricing in a 55.4% probability of another rate hike in October, up from 42.5% a week earlier and 7.2% a month ago, according to CME’s FedWatch tool.
Investor sentiment was also shaped by geopolitical risks surrounding the Iran war and attacks on Saudi oil infrastructure, adding to caution heading into the weekend.
Technology was the strongest-performing sector in the S&P 500, while utilities recorded the biggest decline.
Among individual stocks, Xenon Pharmaceuticals plunged 30.7% after temporarily pausing enrolment in clinical studies of an experimental depression drug following reports of side effects.
Crypto-linked stocks moved sharply higher as bitcoin jumped 5.9%, with Coinbase, Strategy and Robinhood gaining between 9.1% and 16.4%.
Market breadth remained weak, however, with declining stocks outnumbering advancers on both the New York Stock Exchange and Nasdaq.
Trading activity was heavy, with 25.29 billion shares changing hands across US exchanges, well above the 20-day average of 16.19 billion.
