US open: Stocks head south, Treasury yields slide
By Iain Gilbert
Date: Thursday 08 Jul 2021
(Sharecast News) - Wall Street stocks opened sharply lower on Thursday amid rising global Covid-19 cases and falling bond yields.
As of 1530 BST, the Dow Jones Industrial Average was down 1.30% at 34,232.08, while the S&P 500 was 1.37% weaker at 4,298.36 and the Nasdaq Composite came out the gate 1.24% softer at 14,483.57.
The Dow Jones opened 449.71 points lower on Thursday, easily erasing gains recorded in the previous session.
Confidence regarding a global economic rebound from the Covid-19 pandemic appeared to be shaken on Thursday after Japan declared a state of emergency in Tokyo for the upcoming Olympics, with spectators set to be banned from the games.
News that the global Covid-19 death toll topped 4.0m on Wednesday was also in focus, with multiple countries around the world being confronted with rising cases due to variants of the coronavirus.
Stocks tied to an economic reopening traded lower, with Carnival, Royal Caribbean, American Airlines, Delta and Boeing all firmly in the red.
Retailers Macy's and Kohl's were also sharply lower, as were stocks in chipmakers Micron, NVIDIA, Qualcomm, Intel and Applied Materials.
Market participants rotated into Treasuries yet again at the open, pushing the yield on the benchmark 10-year Treasury note to 1.285% after having hit its lowest point since February earlier in the day. The lower rates saw shares in Bank of America, Wells Fargo, Goldman Sachs and other financial giants head south as the decline weighed on the firm's profitability outlooks.
On the macro front, weekly US jobless claims data continued to point towards an improving jobs picture, with initial unemployment claims edging up by 2,000 to 373,000 in the week ended 3 July, according to the Department of Labor. Economists had forecast a drop to 350,000.
The four-week moving average was little changed, dipping by 250 to 394,500, while secondary unemployment claims, which more closely track trends in hiring as opposed to firings, fell by 145,000 to 3.33m in the week ended 26 June.
Still to come, consumer credit change figures for May will be published at 1900 BST.
No major corporate earnings were slated for release on Thursday.
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