Treasury Yields Spike, Tech Stocks Drop As Powell Gets Second Term At Fed

Markets sought direction on Tuesday as investors digested the news that the new Fed Chair will be the same as the old Fed chair.

Treasury yields spiked amid the renomination of Jerome Powell for the Chairman of the Federal Reserve as investors considered the likelihood that the Fed might (eventually) raise rates.

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Tech stocks were most under pressure. Tech valuations rely heavily on future profits…and, high interest rates discount those profits, while low interest rates often inflate them.

Level Chg. Chg. %
DOW Futures 35,577.00 13 0.04%
S&P 500 Futures 4,677.00 -2 -0.04%
Nasdaq Futures 16,337.25 -33 -0.20%

U.S. Dollar and Treasuries

The yield on the 10-year Treasury rose above 1.6%. Meanwhile, the dollar strengthened against a basket of major currencies.

Price Chg. Chg. %
U.S. Dollar Index (DXY): 96.58 +0.03 +0.03%

 

Yield Change Previous close
U.S. 1 Year Treasury Bill 0.188% 0.035 0.153%
U.S. 5 Year Treasury Note 1.363% 0.040 1.323%
U.S. 10 Year Treasury Note 1.657% 0.120 1.538%
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Stocks To Watch

High growth tech stocks dropped as interest rates rose following Jerome Powell’s nomination. Shares of Zoom dropped 8%, even as the company beat earnings expectations. Zoom’s earnings rose 12%, and revenue rose 35%, past $1 billion.

Shares of Best Buy slumped as gross margins disappointed investors. Margins fell to 23.5% from 23.6% last year. The company beat on earnings, at $2.06 a share and $11.85 billion in sales. Analysts expected $1.95 in profits and $11.65 billion in sales.

Semiconductor manufacturer Micron Technology announced a new memory product for AI and a 5G innovation for smartphones. The shares went up, building on the past month’s momentum.

Tesla was up despite Elon Musk selling his shares. The CEO tweeted that the company may launch the Model S Plaid in China as early as March.

Symbol Company Name Price Chg. % Volume
TSLA Tesla Inc. $1,170.95 1.22% 260.31K
MU Micron Technology Inc. $85.75 2.25% 139.23K
ZM Zoom Video Communications Inc. $222.00 -8.37% 132.06K
BBY Best Buy Co. Inc. $123.24 -10.70 110.15K

 

Commodities To Watch

Oil fell amid the report that the Biden Administration would tap strategic reserves. Gold dropped below $1800. 

Resource Price Chg. %
WTI Crude Oil $76.44 -0.40%
Brent Crude Oil $79.75 0.06%
Natural Gas $4.99 4.24%
Gold $1,793.40 -0.71%
Silver $23.77 -2.19%
Copper $4.41 0.33%

 

Crypto

The global crypto market cap is $2.54T, a 2.12% decrease over the last 24 hours. Bitcoin’s dominance is currently 41.85%, a decrease of 0.27% in the same period.

Currency Symbol Price Chg. % Market Cap.
Bitcoin BTC $56,549.41 -1.23% 1.07t
Etherium ETH $4,151.74 -0.75% 490.23b
Binance coin BNB $580.81 +1.30% 87.32b
Solana SOL $212.73 -2.86% 64.67b
Cardano ADA $ 1.77 -1.76% 55.00b

 

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