The Dow Jones Industrial Average dropped to a three-month low last week as the Federal Reserve raised rates with hawkish guidance, while the Nasdaq held up better on strength in software and select growth names. Dow Jones futures resume trading Sunday evening alongside S&P 500 and Nasdaq futures, with the 10-year Treasury yield sitting near 5%.
Dow Jones hits three-month low
The Dow Jones Industrial Average lost 1.7% last week, hitting a three-month low alongside the small-cap Russell 2000, which shed 1.5%. Meanwhile, the Nasdaq rose 0.7% for the week and the S&P 500 dipped 0.1%, with both finishing above their 50-day moving averages.
Elsewhere, the Invesco S&P 500 Equal Weight ETF fell 1.2%, its fifth straight weekly decline.
A choppy week driven by the Fed
Trading swung sharply across the week. AI stocks tumbled Monday after industry leaders called for a development slowdown, while software surged as a result. Stocks then slumped Wednesday on the Fed's rate hike and hawkish guidance, before rebounding broadly Thursday. Indexes finished narrowly mixed Friday as the 10-year Treasury yield moved back toward 19-year highs.
The 10-year yield rose two basis points to 4.995%, while the 30-year yield fell three basis points to 5.33%. The two-year yield, closely tied to Fed rate expectations, jumped 10 basis points to 4.74%.
What to watch this week
Earnings and economic data will be light in the coming week, but the Mideast conflict and its impact on oil prices and Treasury yields remains front and center. President Donald Trump's meeting with Chinese President Xi Jinping on Sept. 24 is also noteworthy.
A choppy market is dangerous for active investors — there's just enough strength to lure buyers in, followed by pullbacks. Traders may want to avoid getting aggressive until sustained momentum returns.
Source: Investor's Business Daily
Trading involves risk.
Risk Disclaimer
