Salem Radio Network News Tuesday, May 24, 2022


Wall St sells off, led by growth shares amid rate concerns

NEW YORK (Reuters) – U.S. stocks ended sharply lower on Monday, led by declines in mega-cap growth shares as the benchmark 10-year yield hit fresh 3-1/2 year highs and investors grew more concerned about the interest rate outlook.

The S&P 500 fell below 4,000, with Apple shares the biggest weight on the index, as well as on the Nasdaq.

Benchmark 10-year U.S. Treasury yields hit their highest levels since November 2018 early in the session. [US/]

Investors are worried about how aggressive the Federal Reserve will need to be to tame inflation. The U.S. central bank last week hiked interest rates by 50 basis points.

“Markets are digesting the start of a return to a more normal monetary policy environment,” said Kristina Hooper, chief global market strategist at Invesco in New York.

“Moving more aggressively (on rates) raises the specter of a recession, especially with all of these complications – high inflation, Russia’s invasion of Ukraine, COVID-related supply chain disruptions,” she said.

Investors have also been worried about an economic slowdown in China following a recent rise in coronavirus cases.

According to preliminary data, the S&P 500 lost 132.79 points, or 3.22%, to end at 3,990.55 points, while the Nasdaq Composite lost 514.91 points, or 4.24%, to 11,629.75. The Dow Jones Industrial Average fell 649.52 points, or 1.97%, to 32,249.85.

Among the hardest hit in the recent selloff have been technology and growth stocks, whose valuations rely more heavily on future cash flows.

The energy sector sector also tumbled as oil prices dropped.

Twitter Inc shares fell as Hindenburg Research took a short position on the social media company’s stock, saying the company’s $44 billon deal to sell itself to Elon Musk has a significant risk of getting repriced lower.


(Additional reporting by Devik Jain and Amruta Khandekar in Bengaluru; Editing by Shounak Dasgupta, Anil D’Silva and Aurora Ellis)


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