Rising Treasury yields
Treasury yields have been rising in recent weeks as investors anticipate continued aggressive interest rate hikes from the Federal Reserve in an effort to combat inflation. Higher Treasury yields make stocks less attractive to investors, as they offer a risk-free return.
Alphabet-led weakness in tech
Alphabet, the parent company of Google, reported disappointing quarterly results in its cloud business on Tuesday. Cloud revenue grew 22% to $8.4 billion, falling short of analyst expectations of $8.6 billion. This news weighed on Alphabet’s stock price, which fell by 9% on Wednesday.
Other tech stocks also fell on Wednesday, as investors worried about a potential slowdown in the tech sector. The Nasdaq Composite index, which is heavily weighted towards tech stocks, fell by 1.4% on Wednesday.
Overall, the Dow fell by 0.4% on Wednesday, as investors sold stocks due to rising Treasury yields and weakness in the tech sector.sharemore_vert