Global stock markets fall on interest rate fears, yields soar
- Investors across the global markets fear that keeping rates high for too long could drag economies into recession
Global stock markets fell on Tuesday as investors’ fears increased that interest rates will rise again and stay elevated for a prolonged period to tame inflation.
Investors across the global markets fear that keeping rates high for too long could drag economies into recession.
Bond yields soared to multi-year highs in the wake of central banks signal that rates may rise again this year.
US stocks
US stocks plunged on Tuesday as treasury yields climbed to 16-year highs in the wake of the Federal Reserve's hawkish outlook.
The S&P 500 lost 63.77 points, or 1.47%, at 4,273.67 points. The Nasdaq Composite fell 206.02 points, or 1.55%, at 13,065.30. The Dow Jones Industrial Average shed 388.75 points, or 1.14%, at 33,618.13.
The yield on the 10-year treasury edged up to 4.55% from 4.54% late Monday.
A report on Tuesday showed that US consumer confidence was weaker than expected.
Shares of Apple fell 2.3% and Microsoft lost 1.7%.
Amazon tumbled 4% after the Federal Trade Commission and 17 state attorneys general filed an antitrust lawsuit against it.
Cintas dropped 5.3%.
Currencies
The US dollar rose to 149.08 Japanese yen from 148.84. It fell to $1.0566 from $1.0588 against the euro.
Among the global markets, Asian stocks fell and European bourses were also down.
Europe
European shares dipped for a fourth day on Tuesday. The pan-European STOXX 600 shed 0.6%.
Britain’s FTSE 100 ended flat at 7,625.72. Germany’s DAX edged down 1% at 15,255.87. France’s CAC 40 lost 0.7% at 7,074.
Technology stocks plunged 2%, while real estate stocks lost 1.9%.
Germany's 10-year government bond yield, the euro area's benchmark, edged up at 2.796%, having briefly hit a 12-year high of 2.813% in early trade.
Shars of Europe’s luxury giants LVMH and Richemont fell 1.4% and 3.0%.
Asia
Asian stock markets declined on Tuesday.
Hong Kong’s Hang Seng index edged down 1.5% at 17,466.90. China’s Shanghai Composite lost 0.4% at 3,102.27.
Japan’s Nikkei 225 fell 1.1% at 32,315.05.
Australia’s S&P/ASX 200 index settled 0.5% lower at 7038.2 points. New Zealand's benchmark S&P/NZX 50 index ended 0.3% lower at 11,342.87.
Energy prices
The US crude oil Benchmark for November delivery rose 71 cents to $90.39 a barrel on Tuesday. Brent crude for November delivery rose 67 cents to $93.96 a barrel.
Bullion
Gold for December delivery fell $16.80 to $1,919.80 an ounce. Silver for December delivery fell 19 cents to $23.20 an ounce and December copper fell 2 cents to $3.65 a pound.
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