NEW YORK: US and European stocks mostly fell Monday (Tuesday in Manila), with tech stocks taking the biggest hit amid growing concerns that borrowing rates will creep higher as the US economy — and prices — recover
Yields on the 10-year US Treasury note pushed higher, rattling investors fearful it signals a similar lurch in interest rates. The advance comes in anticipation the US Congress will soon pass President Joe Biden’s $1.9 trillion stimulus package.
On Wall Street, the tech-rich Nasdaq suffered the biggest hit, losing 2.5 percent behind weakness in Apple, Tesla and other tech names.
Peter Cardillo of Spartan Capital noted that rising lending rates hit tech companies more since they rely more heavily on financing. “Generally, when yields go up, interest rates go up,” Cardillo told AFP.
“But this time around, it may not be the case because the Fed keeps saying they’re not going to change their rate policy for some time to come.”
In fact, Federal Reserve Chair Jerome Powell has repeated assurances that the US central bank has no plans to raise the benchmark interest rate until employment has recovered and inflation begins to rise.
He will have another opportunity to address the issues during two days of testimony in Congress on Tuesday and Wednesday…