LONDON: U.S. stocks ended Tuesday’s choppy session virtually unchanged, after the main indexes gave up earlier modest gains.
Recent weakness in stocks had been triggered by rising interest rates as well as expectations that the Federal Reserve will hike interest rates sooner rather than later in light of upbeat economic data.
U.S. Treasurys sold off, sending the yield on a 10-year note up 4 basis points to 2.43%. European government bonds also saw yields rise.
The S&P 500 SPX, +0.04% closed up less than a point at 2,080.15. The Dow Jones Industrial Average DJIA, -0.01% finished the day flat at 17,764.04. The Nasdaq Composite COMP, -0.15% lost 7.8 points, or 0.2%, to 5,013.87.
Lance Roberts, portfolio manager at STA Wealth Management, said on a daily basis markets are oversold and are likely to bounce in the short term.
“However, we are watching technical levels for indication whether the bounce will take the market to new highs. Falling below support levels would indicate that momentum is waning,” Roberts said.
Jonathan Krinsky, chief market technician at MKM Parners, noted that the weakness in the stock market has been driven by rising interest rates.
“Treasurys had one of their worst weeks in years last week, with the 10-year yield gaining 28 basis points and closing above 2.4% for the first time since last October. As a result, there was a huge dispersion in equities on the sector level, with interest-rate sensitive shares such as utilities, telecoms and consumer staples underperforming,” Krinsky said.
