US stocks dip as rising Treasury yields take steam out of market rally
- US stocks fluctuated after disappointing labor-market data drove up
Treasury yieldsand sparked valuation concerns.
- The US added 117,000 private payrolls in February, ADP said, well below the 200,000 expected.
- The report and the jump in yields offset optimism about COVID-19 vaccine availability in the US.
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US equities traded mixed on Wednesday as rising Treasury yields offset stimulus optimism.
Early strength across stock sectors faded after ADP's monthly employment report showed February job growth missing expectations. The US added 117,000 private payrolls last month, the report said. Economists surveyed by Bloomberg had anticipated a 200,000-payroll gain.
The reading signals that the labor market is returning to growth after a nearly stagnant winter, but the weaker-than-expected data highlights how difficult it will be for the economy to recoup millions of lost jobs.
Treasury yields swung higher soon after the report's release. The move revived concerns of overstretched stock valuations, and the tech-heavy
Here's where US indexes stood shortly after the 9:30 a.m. ET open on Wednesday:
- S&P 500: 3,865.90, down 0.11%
- Dow Jones industrial average: 31,367.87, down 0.08% (23.65 points)
- Nasdaq composite: 13,355.88, down 0.02%
The modest decline followed weakness in Tuesday's session. Valuation concerns led tech stocks to weigh on major indexes. The Nasdaq composite sank the most, tumbling by 1.7% into the close.
ADP's labor-market data overshadowed optimism about coronavirus vaccine availability in the US. President Joe Biden said on Tuesday afternoon that the US would have enough doses for every American by the end of May, pulling forward a key forecast by two months.
The rate of vaccination has neared 2 million doses per day on average, well above the pace of 1.3 million in the final week of February, according to Bloomberg data.
The House passed the president's $1.9 trillion stimulus proposal on Saturday, and Senate Majority Leader Chuck Schumer has said he aims to bring the bill to the Senate floor by midweek. Biden aims to sign the package into law before expanded unemployment benefits lapse in mid-March.
The package is far from a done deal. Democrats are still haggling over some elements of the bill, including the size of a supplement to unemployment insurance. The party needs all 50 votes in the Senate to pass the bill through budget reconciliation, making any last-minute changes risky.
Bitcoin soared above $51,000 after trading as low as $47,118 on Tuesday. The run-up placed the popular cryptocurrency at its highest levels since late February, when it tumbled from record highs.
Spot gold sank 1.7%, to $1,708.43, at intraday lows. The US dollar strengthened against Group-of-20 currencies, and Treasury yields rose.
Oil prices shot higher amid the Treasury sell-off. West Texas Intermediate crude gained as much as 2.3%, to $61.10 per barrel. Brent crude, oil's international benchmark, jumped 2.4%, to $64.18 per barrel, at intraday highs.
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