Wall Street stocks rebound led by Dow Jones and Boeing earnings
|- The tug of war between rising interest rates and earnings is far from over.
- US stocks rebounded on Wednesday led by the Dow Jones and Boeing earnings.
US Stocks rebounded on Wednesday led by Boeing shares which reported better than average earnings. However, the tug of war between rising interest rates and earnings goes on Wall Street. “We’re going to have to continue this back and forth because the question is going to be throughout the year whether or not and at what level are rates too high for the economy,” said Brent Schutte, chief investment strategist at Northwestern Mutual Wealth Management Co.
The S&P 500 rose 0.2% to 2,639.39. The Dow Jones Industrial Average gained 0.3% to 24,083.83 supported by Boeing, which rose on better-than-expected results. Today marked the first rebound after 5 days of losses, a situation which is not seen since March 2017. The Nasdaq Composite Index lost 4.8 points or 0.1% to 7,003.74. The Nasdaq dropped for 5 consecutive days which has not been seen since November 2016.
Meanwhile, the 10 year US benchmark Treasury yields keep creeping higher and traded as high as 3.036% on Wednesday. The move higher in yields can damage companies as the cost to borrow money becomes more expensive. “Earnings have been coming in very strong, but companies aren’t getting rewarded. At the same time, bonds are behaving badly, and with both struggling, investors are feeling nervous about the market in general. The question becomes, where do you hide? Investors are increasingly hiding in cash.” pointed out Michael Mullaney, director of global market research at Boston Partners.
"For 10 years, rates were kept artificially low to encourage risk-taking. Once we get to more normal levels, that's going to become a challenge for equities as an asset class," according to Jack Ablin, founding partner of Cresset Wealth.
Dow Jones daily chart
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.