# Stocks, yields fall; data suggests U.S. economy cooling
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-04-05
Category: NEWS
Category URL: https://financedigest.com/category/news
Meta Title: Global Stock Indexes Decline as U.S. Dollar Hits Two-Month
Meta Description: Get the latest updates on world stock market declines, US Dollar, Treasury yields, and the cooling US labour market in our comprehensive report.
URL: https://financedigest.com/stocks-yields-fall-data-suggests-u-s-economy-coolinghtml

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By Caroline Valetkevitch

NEW YORK (Reuters) – World stock indexes declined on Tuesday, with all three major U.S. [stock indexes ending lower](https://www.financedigest.com/miners-drag-london-stocks-lower-unite-group-slips.html "Miners drag London stocks lower; Unite Group slips"), while the U.S. dollar fell to a two-month low 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") eased after data suggested a cooling in the U.S. [labor market](https://www.financedigest.com/u-s-job-growth-surges-in-july-as-labor-market-defies-recession-fears.html "U.S. job growth surges in July as labor market defies recession fears").

The U.S. Labor [Department report](https://www.financedigest.com/it-departments-find-it-hard-to-keep-the-cloud-safe-report.html "IT Departments Find It Hard to Keep the Cloud Safe: Report") showed U.S. [job openings in February dropped to the lowest level in nearly two years](https://www.financedigest.com/inpost-sees-better-margin-in-poland-plans-no-job-cuts-this-year.html "InPost sees better margin in Poland, plans no job cuts this year").

In addition, a separate [report showed new orders](https://www.financedigest.com/n-korea-reports-first-covid-outbreak-orders-lockdown-in-gravest-emergency.html "N.Korea reports first COVID outbreak, orders lockdown in “gravest emergency”") for U.S.-manufactured goods fell for a [second straight month](https://www.financedigest.com/inflation-in-key-german-states-eases-for-second-month.html "Inflation in key German states eases for second month") in February amid ebbing demand for civilian aircraft.

The S&P 500 was pressured the most by the [economically sensitive industrial sector](https://www.financedigest.com/combatting-economic-uncertainty-in-2023-with-the-payments-sector-2.html "Combatting economic uncertainty in 2023 with the payments sector"), which ended down 2.3%. Materials also finished lower.

The [yield on two-year Treasuries](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"), which typically move in step with interest rate expectations, fell 14 basis points to 3.840%, while the benchmark 10-year note’s yield slid 9 basis points to 3.342%.

Crude oil [prices were near flat after Monday’s sharp rally tied to Sunday’s announcement of an output target cut](https://www.financedigest.com/tesla-posts-record-quarterly-deliveries-after-price-cuts-up-4-from-q4.html "Tesla posts record quarterly deliveries after price cuts, up 4% from Q4") by the Organization of the Petroleum Exporting Countries (OPEC) and its partners.

Brent crude rose 1 cent to settle at $84.94 a barrel, while U.S. crude [gained 29 cents](https://www.financedigest.com/survey-only-7-per-cent-of-businesses-gdpr-compliant-as-deadline-looms-data-privacy-gains-prominence.html "Survey: Only 7 per cent of businesses GDPR-compliant as deadline looms, data privacy gains prominence") to settle at $80.71.

The recent spike in [oil prices](https://www.financedigest.com/oil-ticks-up-as-u-s-inflation-cools-but-prices-set-for-monthly-drop.html "Oil ticks up as U.S. inflation cools, but prices set for monthly drop") has added to concerns about higher costs for businesses and consumers, but some investors think U.S. data signaling some cooling in the economy could [possibly allow the Federal Reserve to loosen monetary policy](https://www.financedigest.com/yen-trims-gains-as-possible-next-boj-governor-says-current-policy-appropriate.html "Yen trims gains as possible next BOJ governor says current policy appropriate").

The Dow Jones Industrial Average fell 198.77 points, or 0.59%, to 33,402.38, the S&P 500 lost 23.91 points, or 0.58%, to 4,100.6 and the Nasdaq Composite dropped 63.13 points, or 0.52%, to 12,126.33.

The pan-European STOXX 600 index lost 0.08% and MSCI’s gauge of stocks [across the globe](https://www.financedigest.com/sales-of-medical-beds-across-the-globe-are-estimated-to-exceed-us-3000-mn-in-revenues-by-2022-end.html "Sales of Medical Beds Across the Globe are Estimated to Exceed US$ 3,000 Mn in Revenues by 2022-end") shed 0.24%.

The Fed and other central [banks have been raising interest rates to bring down inflation](https://www.financedigest.com/be-really-really-careful-on-inflation-bank-of-englands-haskel.html "Be ‘really, really careful’ on inflation – Bank of England’s Haskel"), and investors have been trying to gauge how much longer the tightening cycle will continue.

[“Cooling down of the labor market is one of the things necessary to combat inflation,”](https://www.financedigest.com/dollar-drops-as-inflation-cools-more-than-expected.html "Dollar drops as inflation cools more than expected") said Andrzej Skiba, head of the BlueBay U.S. fixed income team at RBC [Global Asset Management in New York](https://www.financedigest.com/new-york-catches-up-with-london-to-head-citys-global-centres-survey.html "New York catches up with London to head City’s global centres survey").

On Tuesday, rate futures markets were pricing in a roughly even chance of a 25 basis-point rate hike in May, with rest of the odds tilted toward a [pause from the Fed](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"). On Monday, the probability of a 25-bp hike was more than 65%.

The U.S. [dollar index dropped to a two-month low](https://www.financedigest.com/euro-rises-after-spanish-cpi-dollar-slips-towards-8-mth-low.html "Euro rises after Spanish CPI, dollar slips towards 8-mth low") of 101.45 and was last down 0.5% at 101.56. Sterling rose to a new 10-month high against the dollar, while the euro [reached its highest level since](https://www.financedigest.com/soccer-arsenal-reach-womens-champions-league-semis-for-first-time-since-2013.html "Soccer-Arsenal reach Women’s Champions League semis for first time since 2013") February. The euro was last up 0.5% at $1.09550.

We believe the buck will slowly but surely continue to dwindle as the challenges of a recovering [economy that wants to get away from dollar](https://www.financedigest.com/stocks-dollar-gain-on-resilient-u-s-economy.html "Stocks, dollar gain on resilient U.S. economy") dominance will put downward pressure on its value,” said Juan Perez, director of trading at Monex USA in Washington.

The Australian [dollar came under pressure after the Reserve Bank of Australia left interest rates](https://www.financedigest.com/powells-warning-on-higher-u-s-rates-pushes-dollar-to-3-mth-high.html "Powell’s warning on higher U.S. rates pushes dollar to 3-mth high") unchanged after 10 straight increases. It was last down 0.5% against the U.S. dollar at $0.6754.

Spot gold added 1.8% to $2,020.42 an ounce.

(Reporting by Caroline Valetkevitch in New York; Additional reporting by Amanda Cooper in [London and Herbert Lash and Gertrude Chavez-Dreyfuss in New York; Editing by Jonathan Oatis, Matthew Lewis and Deepa Babington)](https://www.financedigest.com/new-york-holds-top-spot-london-second-in-z-yen-financial-centre-survey.html "New York holds top spot, London second in Z/Yen financial centre survey")


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