US equities tumbled from all-time highs as investors weighed the start of the corporate earnings season and an increase in the total amount of bond offerings that triggered the rally.
Intel plunged together with Nvidia Corp., making the Nasdaq 100 fall as well. Yields rallied as the US Treasury auctioned 3- and 10-year bonds amid weaker demand than in the previous bond sales. The government will place 30-year bonds tomorrow.
While the US recovery is accelerating, several countries in Europe and South America are suffering from rising Covid-19 cases and vaccination problems. The rotation to cyclical and small-cap stocks also appears to have stopped, prompting concerns over the strength of the US economic recovery early in the earnings season.
At the same time, colossal government spendings and stimulus from the central bank can trigger excessive inflation. On Sunday, in an interview with CBS’s 60 Minutes, Federal Reserve Chairman Jerome Powell tried to reassure that any spike in price pressures would be short-lived.
In the world market, oil rose slightly above $60 per barrel. The yield on US government bonds rose just above 1.67%.
Main market quotes:
- S&P 500 (F) 4,119.62 -0.63 (-0.02%)
- Dow Jones 33,745.40 -55.20 (-0.16%)
- DAX 15,255.30 +40.30 (+0.26%)
- FTSE 100 6,884.67 -4,45 (-0.06%)
- USD Index 92.218 +0.074 (+0.08%)
Important events:
- UK Monthly GDP (3m/3m) at 09:00 (GMT+3);
- UK Manufacturing Output (m/m) (Feb) at 11:30 (GMT+3);
- The ZEW Indicator of Economic Sentiment in Germany (Apr) at 12:00 (GMT+3);
- US Core Consumer Price Index (CPI) (m/m) (Mar) at 15:30 (GMT+3).
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