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Dow Jones Falls 1,300 Points as Bonds and Oil Rise
U.S. stock markets fell again on Wednesday.
The Dow Jones has now lost 1,300 points over three sessions.
Stock prices were pressured by rising borrowing costs in the bond market.
Oil prices also climbed above $101 per barrel.
Tensions involving Iran and the Strait of Hormuz contributed to the oil-price increase.
The Treasury tried to support bond prices by buying more bonds.
However, bond yields still rose after the announcement.
Investors are now waiting for inflation, jobs, housing, and company-results data before the Federal Reserve’s next policy decision.
The Dow Jones fell another 400 points on Wednesday, extending its three-session decline to 1,300 points.
The S&P 500 dropped 0.6%, while the Nasdaq declined 0.5%.
Brent crude rose above $101 a barrel as tensions involving Iran and the Strait of Hormuz intensified.
The United States Treasury announced a $6 billion bond buyback for Thursday, up from an initially announced $2 billion.
U.S. Treasury yields continued rising after the announcement, with the 10-year yield reaching 4.85% and the 30-year yield 5.3%.
- Who
- U.S. investors, the Treasury, President Donald Trump, Iran, and the Federal Reserve are involved.
- What
- U.S. stocks fell sharply as Treasury yields and oil prices increased despite an expanded bond-buyback program.
- Where
- Wall Street and U.S. Treasury markets; oil prices were affected by tensions around the Strait of Hormuz.
- When
- Wednesday, September 9; the Dow’s decline occurred over three sessions, with additional data due before next week’s Federal Reserve decision.
- Why
- Rising Treasury yields, higher oil prices, geopolitical tensions, and concern about inflation added pressure to markets.
Key facts
- Dow Jones decline
- The index fell 400 points on Wednesday and 1,300 points over three sessions.
- Other major indexes
- The S&P 500 fell 0.6% and the Nasdaq fell 0.5%.
- Brent crude
- Brent crude rose above $101 per barrel.
- Thursday bond buyback
- The U.S. Treasury plans to buy $6 billion of bonds, compared with an initially announced $2 billion.
- 10-year Treasury yield
- The yield reached 4.85%, its highest level since November 2023.
- 30-year Treasury yield
- The yield reached 5.3%, near the previous month’s 5.33% level.
- Dollar index
- The U.S. Dollar Index closed at a seven-month low, its lowest close since February 17.
Sources
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