THE NEW YORK TIMES: U.S. stocks fell on Tuesday, with the S&P 500 falling 2 percent by midday, putting the index on track for its worst day since May.
The trigger for Tuesday’s sell-off was a rise in the yield on the benchmark 10-year Treasury note. Investors, weighing the prospect of the Federal Reserve preparing to reduce its purchases of government debt, sold off bonds, pushing the 10-year’s yield up to 1.53 percent, its highest level since June.
Government bond yields are the basis for borrowing costs across the economy, and a rise can hinder the stock market’s performance because it makes owning bonds more attractive and can discourage riskier investments.
Tech stocks are particularly sensitive to the prospect of higher interest rates, and those companies’ shares were hard-hit on Tuesday. The tech-heavy Nasdaq composite was down 2.7 percent at midday. » | Coral Murphy Marcos (Jeanna Smialek contributed reporting.) | Tuesday, September 28, 2021
