# Wall St ends lower, Treasury yields slide as data fuels recession jitters
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2023-04-05
Category: INVESTING
Category URL: https://financedigest.com/category/investing
Meta Title: U.S. Stocks Extending Decline, Recession Fears Rise
Meta Description: Read how U.S. stocks fell as Treasury yields extended their decline on concerns of central bank policies leading to recession risk.
URL: https://financedigest.com/wall-st-ends-lower-treasury-yields-slide-as-data-fuels-recession-jittershtml

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By Stephen Culp

NEW YORK (Reuters) – U.S. stocks lost ground on Wednesday and Treasury yields extended their decline as a batch of data fueled worries that restrictive central bank policies could push the global [economy into recession](https://www.financedigest.com/german-economy-expected-to-skirt-recession-economy-ministry-report.html "German economy expected to skirt recession – economy ministry report").

The S&P 500 closed in negative territory, and megacap momentum [stocks](https://www.financedigest.com/mutual-funds-vs-stocks-which-is-better.html "stocks") dragged the tech-heavy Nasdaq down more than 1%, while defensive stocks helped keep the Dow modestly green.

The 10-year [Treasury yield](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") slid further to a near seven-month low.

A spate of economic indicators on Wednesday [suggested](https://www.financedigest.com/big-data-suggests-leicesters-football-success-could-usher-in-economic-boom.html "Big data suggests Leicester’s football success could usher in economic boom") economic cracks are beginning to show. Private sector job adds fell well short of expectations, demand for home loans is softening despite [falling mortgage rates](https://www.financedigest.com/oil-dips-as-potential-fed-rate-hike-overshadows-falling-stocks.html "Oil dips as potential Fed rate hike overshadows falling stocks"), and the services sector is losing momentum.

Together, the [data appears to suggest the Federal Reserve’s monetary tightening – designed to rein in inflation](https://www.financedigest.com/european-shares-rise-as-us-inflation-data-signals-end-of-rate-hike-cycle.html "European shares rise as US inflation data signals end of rate-hike cycle") by tossing cold water on the U.S. economy – is having its intended effect.

“The Fed did what it wanted. The [economy is slowing](https://www.financedigest.com/thomson-reuters-keeps-outlook-but-wary-of-slowing-economy.html "Thomson Reuters keeps outlook, but wary of slowing economy") down. It’s working,” said Peter Tuz, [president of Chase Investment](https://www.financedigest.com/investment-firm-fort-lp-appoints-veteran-asset-management-executive-stuart-bohart-as-president.html "Investment Firm Fort LP Appoints Veteran Asset Management Executive Stuart Bohart as President") Counsel in Charlottesville, Virginia. “There’s a lot of thought out there that they might have overdone it.”

When the [Fed raises interest rates](https://www.financedigest.com/wage-data-dents-dollar-recovery-before-fed-rate-decision.html "Wage data dents dollar recovery before Fed rate decision"), the effects are both cumulative and with a lag,” Tuz added. “The lag is over, we are seeing broad based softness.”

At last glance, financial markets are pricing in a 57% likelihood that the central [bank will let its key interest rate stand at its still-restrictive 4.75%-5.00% range at the conclusion of its next policy meeting](https://www.financedigest.com/banking-stability-worries-go-behind-closed-doors-at-imf-world-bank-meetings.html "Banking stability worries go behind closed doors at IMF-World Bank meetings") in May, according to CME’s FedWatch tool.

Traders bet on [Fed rate](https://www.financedigest.com/stocks-euro-gain-amid-divergent-fed-ecb-rate-hike-outlooks.html "Stocks, euro gain amid divergent Fed, ECB rate hike outlooks") cut by July meeting https://www.reuters.com/graphics/USA-RATES/FEDWATCH/egpbyjlzxvq/chart.png

![](https://onlineworldnews.com/wp-content/uploads/2023/04/chart-300x182.jpg)

The Dow Jones Industrial Average rose 80.34 points, or 0.24%, to 33,482.72; the S&P 500 lost 10.22 points, or 0.25%, at 4,090.38; and the Nasdaq Composite dropped 129.47 points, or 1.07%, to 11,996.86.

European shares edged lower as [investors remained](https://www.financedigest.com/6-months-to-go-until-brexit-and-investor-sentiment-remains-bold.html "6 months to go until Brexit and investor sentiment remains bold") cautious, tilting toward defensive stocks amid economic uncertainty.

The pan-European STOXX 600 index lost 0.16% 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 0.45%.

Emerging [market stocks](https://www.financedigest.com/the-secret-to-stock-market-success.html "The Secret to Stock Market Success") lost 0.10%. MSCI’s broadest index of Asia-Pacific [shares outside Japan closed 0.02% lower](https://www.financedigest.com/britains-next-sees-lower-clothing-inflation-shares-dip-on-cautious-outlook.html "Britain’s Next sees lower clothing inflation, shares dip on cautious outlook"), while Japan’s Nikkei lost 1.68%.

Treasury yields slipped further, with the benchmark 10-year yield touching lows last seen in September as the [soft economic](https://www.financedigest.com/dollar-skids-after-soft-u-s-economic-data-impact-of-opec-cuts-fades.html "Dollar skids after soft U.S. economic data; impact of OPEC+ cuts fades") reports supported the notion of a “Fed pause.

Benchmark 10-year [notes last rose 8/32 in price](https://www.financedigest.com/uk-house-prices-end-2022-on-a-weaker-note-after-pandemic-boom.html "UK house prices end 2022 on a weaker note after pandemic boom") to yield 3.3089%, from 3.337% late on Tuesday.

The 30-year [bond last rose 16/32 in price to yield](https://www.financedigest.com/global-equities-gain-as-rising-bond-yields-pressure-gold.html "Global equities gain, as rising bond yields pressure gold") 3.5676%, from 3.594% late on Tuesday.

The greenback advanced against a basket of world currencies after disappointing private payrolls data prompted [investors to lighten their short positions ahead of the Labor Department’s payrolls report](https://www.financedigest.com/influx-of-one-time-investors-swapping-stocks-for-bricks-and-mortar-reports-agency.html "Influx of ‘one-time’ investors swapping stocks for bricks and mortar reports agency") on Friday.

The dollar index rose 0.32%, with the euro down 0.47% to $1.09.

The [Japanese yen](https://www.financedigest.com/japanese-yen-gains-as-ueda-set-to-be-named-next-boj-governor.html "Japanese yen gains as Ueda set to be named next BOJ governor") strengthened 0.25% versus the greenback at 131.39 per dollar, while sterling was last trading at $1.2455, down 0.35% on the day.

Crude [prices were mixed as investors weighed signs of economic](https://www.financedigest.com/sony-hikes-ps5-price-on-economic-pressures-rising-rates.html "Sony hikes PS5 price on economic pressures, rising rates") softness against a U.S. [stock draw-down and plans by OPEC+ producers to cut oil](https://www.financedigest.com/oil-stocks-thrust-london-shares-to-positive-2023-start.html "Oil stocks thrust London shares to positive 2023 start") output.

U.S. crude fell 0.12% to settle at $80.61 per barrel and Brent settled at $84.99 per barrel, up 0.06% on the day.

Gold prices were essentially flat after briefly touching their highest level [since March](https://www.financedigest.com/the-nasdaq-100-on-track-to-have-its-best-week-since-march-2010.html "The Nasdaq 100 On Track to Have its Best Week Since March 2010") 2022.

Spot gold % to $2,020.39 an ounce.

(Reporting by Stephen Culp; Additional reporting by Dhara Ranasinghe; Editing by Andrea Ricci, Diane Craft and Richard Chang)


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