On Wednesday, the benchmark indices of Wall Street witnessed a decline due to a decrease in the value of large-cap stocks caused by the rise in Treasury yields. The surge in December's US retail sales dampened optimism of early interest-rate cuts by the Federal Reserve in the coming year.
While S&P 500 reached its lowest point in over a week, Dow Jones, representing blue-chip stocks, fell to a level not seen in nearly a month.
Major companies like Apple, Alphabet, Amazon, and Meta Platforms witnessed losses ranging from 1.3 per cent to 2.2 per cent. As per a report by Reuters, the drop was majorly attributed to the 10-year Treasury yield surpassing 4 per cent.
The IT sector saw the most significant decline, dropping by 1.4 per cent. Data cited in the report signified that robust US retail sales, fueled by discounted offerings from retailers and increased motor-vehicle purchases, exceeded expectations, contributing to the economy's stability.
At the midpoint of this month, the momentum from Wall Street's impressive 14 per cent surge in the final two months of 2023 is waning. This is attributed to ongoing efforts by U.S. central bankers to temper expectations for an immediate initiation of policy easing.
The CBOE Market Volatility Index, serving as an indicator of market fear, rose to a level exceeding 14.80 points, reaching its highest point in over two months.
The Russell 2000 index, representing small-cap stocks, fell by 1.1 per cent to reach a new low not seen in the past month.