Stocks drop to more than one week low
U.S. stocks dropped to the lowest levels in more than a week and Treasury yields edged higher amid growing concern rising borrowing costs could sap a rally that's driven equity values to historic highs.
The tech-heavy Nasdaq 100 slumped 0.4%, the third consecutive decline. The energy and communication services sectors weighed on the S&P 500, which posted its biggest drop since Jan. 29. A report earlier showed initial jobless claims rose more than expected. Walmart Inc. fell 6.5% after saying it will increase spending on worker salaries and automation.
"This rise in rates will certainly test the mettle and staying power of the bulls," said Peter Boockvar, chief investment officer at Bleakley Advisory Group.
Yields on 10-year Treasuries climbed as high as 1.32% before paring the increase. Yields reached the highest levels in a year earlier this week. Technology companies such as Tesla Inc., which have seen their valuations surge, are often seen as the most at risk of a pullback.
"The market is starting to get a little wary of this 'bad news is good news' scenario," said Matt Benkendorf, chief investment officer of Vontobel Quality Growth. "Now you've seen a bit of a mixed picture, which scrambles the monetary policy visibility."
In currency markets, the pound touched the strongest level versus the euro since March amid continued optimism over the nation's vaccine rollout. The dollar weakened against Group of 10 peers. Bitcoin retreated, paring its weekly gain to 5%.
Commodities were broadly higher, with lumber futures climbed to a record $1,004.90 per 1,000 board feet. Copper in London hit a fresh 8-year high as China's traders returned from holiday with metals markets in a bullish mood.
Meanwhile, the global oil market is grappling with a crisis caused by freezing temperatures in the U.S. More than 4 million barrels a day of output -- almost 40% of the nation's crude production -- is now offline, according to traders and executives.
Stocks in Asia dropped overnight, with the Hang Seng Index down 1.6% and Japan's Topix index 1% lower.
These are some of the main moves in markets:
The S&P 500 Index decreased 0.4% to 3,914 as of 4:03 p.m. EST, the lowest in more than a week on the largest dip in almost three weeks.
The Dow Jones industrial average decreased 0.4% to 31,493.93, the first retreat in a week and the biggest dip in almost three weeks.
The Nasdaq Composite Index dipped 0.7% to 13,865.36, the lowest in almost two weeks on the largest dip in almost three weeks.
The Stoxx Europe 600 Index decreased 0.8% to 412.70, the lowest in a week on the biggest dip in almost three weeks.
The MSCI All-Country World Index decreased 0.5% to 679.13, the lowest in more than a week on the largest dip in almost three weeks.
The Bloomberg Dollar Spot Index fell 0.2% to 1,126.71, the biggest fall in more than a week.
The euro gained 0.4% to $1.2092, the largest advance in more than a week.
The Japanese yen strengthened 0.2% to 105.65 per dollar, the biggest advance in more than a week.
The British pound jumped 0.9% to $1.3975, the strongest in almost three years on the largest climb in more than five weeks.
The yield on 10-year Treasurys gained two basis points to 1.29%.
Germany's 10-year yield rose two basis points to -0.35%, the highest in more than eight months.
Britain's 10-year yield climbed five basis points to 0.622%, the highest in 11 months.
West Texas Intermediate crude sank 1.8% to $60.06 a barrel, the first retreat in a week and the largest tumble in almost five weeks.
Gold depreciated 0.1% to $1,774.36 an ounce, reaching the weakest in almost eight months on its sixth consecutive decline.
Copper jumped 2.3% to $3.91 a pound, the highest on record with the largest jump in more than six weeks.