# Stocks dip, yields climb as rate hikes seem to stay the course Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2022-10-06 Category: NEWS Category URL: https://financedigest.com/category/news Meta Title: U.S. stocks slip but dollar and Treasury yields rise Meta Description: Stay informed on the latest market trends as U.S. stocks slip, dollar and Treasury yields rise on hot economy signs and hawkish Fed remarks. URL: https://financedigest.com/stocks-dip-yields-climb-as-rate-hikes-seem-to-stay-the-coursehtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/2022-10-05t114215z1lynxmpei940m2rtroptp4oil-opec-meeting-1-1736815093092-compressed.jpg) By Pete Schroeder WASHINGTON (Reuters) -U.S. stocks slipped Wednesday, ending the strongest two-day rally since 2020, while the dollar and [Treasury yields](https://www.financedigest.com/wall-street-drops-treasury-yields-gyrate-on-fed-chairman-powells-remarks.html "Wall Street drops, Treasury yields gyrate on Fed Chairman Powell’s remarks") rose on the back of signs the U.S. economy remained hot and Federal Reserve officials were resolute in [rate hikes](https://www.financedigest.com/wall-street-slips-dollar-gains-as-fed-seen-hiking-rates-in-may.html "Wall Street slips, dollar gains as Fed seen hiking rates in May"). Signs of softening in the labor market in earlier the week gave way to new data showing the jobs market remains hot bolstered ongoing hawkish talk from Fed officials and dwindled hopes for a pivot from a steady stream of [rate hikes](https://www.financedigest.com/stocks-falter-as-economic-worries-nag-nz-delivers-big-rate-hike.html "Stocks falter as economic worries nag, NZ delivers big rate hike") to fight inflation. [Wall Street](https://www.financedigest.com/wall-street-stocks-power-higher-as-treasury-yields-and-dollar-ease.html "Wall Street stocks power higher as Treasury yields and dollar ease") shrank its steepest losses on the day but still ended lower. The Dow Jones Industrial Average fell 0.14%, the S&P 500 lost 0.20% and the Nasdaq Composite dropped 0.25%. The MSCI world [equity index](https://www.financedigest.com/six-securities-services-launches-new-equity-index-baskets.html "SIX Securities Services launches new Equity Index Baskets"), which tracks shares in 45 nations, was last down 0.12%. U.S. [Treasury yields](https://www.financedigest.com/wall-st-flutters-treasury-yields-ease-as-powell-resumes-testimony.html "Wall St flutters, Treasury yields ease as Powell resumes testimony") and dollar regained lost ground from the last two days in turn. The [yield on benchmark 10-year Treasuries](https://www.financedigest.com/wall-st-indexes-mixed-treasury-yields-tick-up-as-higher-rates-loom.html "Wall St indexes mixed, Treasury yields tick up as higher rates loom"), was up 14 basis points to 3.749%. The dollar index, which tracks the greenback versus a [basket of six currencies](https://www.financedigest.com/the-yuan-makes-its-official-entry-into-rawbanks-currency-basket.html "The yuan makes its official entry into RAWBANK’s currency basket"), was up 1.03% to 111.193. Hopes that the economy may be slowing enough to get central bank officials to step [back from large hikes](https://www.financedigest.com/uks-bellway-to-buy-back-shares-hike-social-housing-output.html "UK’s Bellway to buy back shares, hike social housing output") took a blow Wednesday on several fronts. The Bank of New Zealand stuck with a sizeable [rate hike](https://www.financedigest.com/dollar-hits-one-month-high-against-yen-as-traders-bet-on-fed-rate-hike.html "Dollar hits one-month high against yen as traders bet on Fed rate hike"), the ADP National Employment report showed private employment rising by more than estimated in September, and the Institute for Supply Management reported the service sector shrank less than expected in September and employment ticked up. That all combined to [suggest the economy](https://www.financedigest.com/stocks-yields-fall-data-suggests-u-s-economy-cooling.html "Stocks, yields fall; data suggests U.S. economy cooling") was not yet slowing enough in response to rate hikes for central banks to rethink their approach. Atlanta Fed President Raphael Bostic said the Fed’s fight against [inflation is likely “still in early days” despite “glimmers of hope” in recent data](https://www.financedigest.com/stocks-mixed-dollar-gains-after-robust-inflation-jobs-data.html "Stocks mixed, dollar gains after robust inflation, jobs data"). The [stock and bond rally](https://www.financedigest.com/asian-stocks-rally-as-bank-jitters-calm-alibaba-lifts-mood.html "Asian stocks rally as bank jitters calm, Alibaba lifts mood") of the last few days was driven by weaker economic and labor market data. Today, stocks and bonds are both selling off after a more hawkish policy decision from New Zealand and [stronger economic data](https://www.financedigest.com/oil-slumps-on-economic-data-stronger-u-s-dollar.html "Oil slumps on economic data, stronger U.S. dollar") from the U.S.,” said Jacob Manoukian, U.S. head of investment strategy at JPMorgan [Private Bank](https://www.financedigest.com/gucci-banks-on-private-salons-for-the-ultra-rich-to-revive-sales.html "Gucci banks on private ‘salons’ for the ultra-rich to revive sales"). It’s hard to read too much into day to day price moves when [markets are this skittish, but the broad driver of markets for the rest of the third quarter will probably be the trajectory of policy](https://www.financedigest.com/stocks-up-bond-yields-fall-as-markets-mull-a-fed-policy-pause.html "Stocks up, bond yields fall as markets mull a Fed policy pause") rates. On Friday, the U.S. Labor Department will [report monthly](https://www.financedigest.com/stablecoin-tether-hires-bdo-italia-for-monthly-proof-of-reserve-reports.html "Stablecoin Tether hires BDO Italia for monthly proof-of-reserve reports") jobs numbers, which will further flesh out the state of the labor market for investors and policymakers. [OIL RISES](https://www.financedigest.com/oil-falls-as-earthquake-impact-on-crude-eases-rate-hike-fears-rise.html "Oil falls as earthquake impact on crude eases, rate hike fears rise") ON SUPPLY CUTS [Oil prices leaped to their third straight day of gains, hitting a three-week high after OPEC+ agreed to cut oil output](https://www.financedigest.com/uk-oil-gas-firms-to-leave-years-worth-of-output-in-ground-with-tax-hikes-report.html "UK oil, gas firms to leave year’s worth of output in ground with tax hikes-report") by 2 million barrels per day, which accounts for roughly 2% of global supply and are the steepest cuts since the 2020 COVID pandemic. Brent crude ended up 1.7% at $93.37 a barrel. U.S. crude was up 1.4% at $87.76 per barrel. Elsewhere, spot gold traded at around $1,716.89 per ounce, down about 0.54%. \[GOL/\] (Reporting by Dhara Ranasinghe and Elizabeth Howcroft; additional reporting by Danilo Masoni; Editing by Marguerita Choy, Alexandra Hudson) --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---