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S&P 500 Wobbles as Banks Hit By Falling Bond Yields on Growth Worries

Stock Markets Mar 23, 2022 04:08PM ET
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By Yasin Ebrahim

Investing.com -- The S&P 500 closed lower Wednesday, led by bank stocks as Treasury yields retreated after rising oil prices renewed worries about the inflation drag on global growth.

The S&P 500 fell 1.2%, the Dow Jones Industrial Average fell 1.3%, or 448 points, the Nasdaq slipped 1.3%.

Crude oil exports from Kazakhstan's Caspian Pipeline Consortium terminal, which are shipped via the Russian port of Novorossiysk, were suspended following weather-related disruptions, triggering fresh fears of supply shortages.

The move higher in oil prices returned focus to the threat higher inflation poses to global growth just as investors mull the prospect of the Fed hiking rates more aggressively at its meetings in May and June.

St. Louis Federal Reserve Bank President James Bullard reiterated on Wednesday the Fed needs to act "faster" on raising interest rates as inflation is "way over" the central bank's target. 

The market currently expects the Fed to raise rates by 50 basis points at its May and June meetings.  

The bets on a hawkish Fed exacerbated worries the Fed may overshoot of rate hikes and slow the economy into recession, triggering a fresh flight to safe heavens such as bonds.

Treasury yields, which trade inversely to prices, fell and weighed on bank stocks. Signature Bank (NASDAQ:SBNY), Wells Fargo (NYSE:WFC), First Republic Bank (NYSE:FRC) led the move lower.

Tech, which tends to benefit from the falling rates, was mostly in the red, though Apple (NASDAQ:AAPL) bucked the trend, to close up nearly 1% higher. 

Apple’s iPhone 13 is seeing “stellar” demand globally, and likely “setting up for a monster growth cycle over the next 12 to 18 that is not baked into shares at current levels,” Wedbush said in a note.

Adobe Systems (NASDAQ:ADBE) fell as much as 9% after its software guidance overshadowed quarterly results that beat on both the top and bottom lines, and stoked fears about peaking growth.  

“These results further support our thesis of peaking net new DM ARR, which we have believed would result in less forward upside to consensus estimates and drive decelerating revenue growth, which we anticipated will weigh on the stock’s performance,” Credit Suisse said in a note as it cut its price target on the stock to $525 from $625.

General Mills (NYSE:GIS), meanwhile, gained more than 2% after raising its full-year outlook following better-than-expected quarterly earnings.

Meme stocks remained on the comeback trail. GameStop (NYSE:GME) added 14% to its 30% gain a day earlier after GameStop Chair Ryan Cohen on Tuesday bought an additional 100,000 shares, expanding his stake in the video game retailer to 11.9%.

AMC Entertainment (NYSE:AMC) was up 14%. 

In other news, Okta (NASDAQ:OKTA) fell 10% after confirming that a hacking group known as Lapsus$ had carried out a cyber attack, though said security protocols contained the hack.

S&P 500 Wobbles as Banks Hit By Falling Bond Yields on Growth Worries
 

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Comments (11)
Chad Richer Than You
Chad Richer Than You Mar 23, 2022 8:14PM ET
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Stop stocking food cans and just buy SP500. No recession in sight. No end of days. The market has factored in and forgotten about Russia-Ukraine.
Bruno Diaz
Bruno Diaz Mar 23, 2022 6:45PM ET
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Bullish Chartists are about to learn the HARDEST lesson of thier lives...
Jose Cabreja
Jose Cabreja Mar 23, 2022 6:34PM ET
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I guess no growth worries last few green days🤣🤣🤣 like things got better.
Dave Jones
Dave Jones Mar 23, 2022 6:31PM ET
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I don't think yields going down is the main concern.
Chad Richer Than You
Chad Richer Than You Mar 23, 2022 6:21PM ET
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Stop stocking food cand and just buy SP500. No recession in sight. No end of days. The market has factored in and forgotten about Russia-Ukraine.
Chad Richer Than You
Chad Richer Than You Mar 23, 2022 6:20PM ET
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Stop stocking food cand and just buy SP500. No recession in site. No end of days. The market has factored in and forgotten about Russia-Ukraine.
Chad Richer Than You
Chad Richer Than You Mar 23, 2022 6:17PM ET
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Just buy SP500. W t f would you buy otherwise!
kris olson
kris olson Mar 23, 2022 6:04PM ET
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govt continues to kick the can, rising costs, rising rates, potential for Cyber Attack that could cripple financial institutions, global food shortage, Unaffordable fuel, and a war in Europe while we flirt with all time highs in the market; anyone putting money on the upside right now will be left holding the bag.
kris olson
kris olson Mar 23, 2022 6:04PM ET
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govt continues to kick the can, rising costs, rising rates, potential for Cyber Attack that could cripple financial institutions, global food shortage, Unaffordable fuel, and a war in Europe while we flirt with all time highs in the market; anyone putting money on the upside right now will be left holding the bag.
kris olson
kris olson Mar 23, 2022 6:04PM ET
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govt continues to kick the can, rising costs, rising rates, potential for Cyber Attack that could cripple financial institutions, global food shortage, Unaffordable fuel, and a war in Europe while we flirt with all time highs in the market; anyone putting money on the upside right now will be left holding the bag.
 
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