TECH-HEAVY NASDAQ SLIDES AS YIELDS RISE, CHIP STOCKS FALL

On Wednesday, the Nasdaq, driven by growth stocks, experienced a decline as rising U.S. Treasury yields impacted the market. Investors were eagerly awaiting further data to gauge the timing of potential Federal Reserve interest-rate adjustments. Although ten of the 11 major S&P 500 sectors saw gains, the technology sector, a significant market mover, faced a 1.4% decrease. This decline was influenced by rising yields on treasury notes, which particularly affected rate-sensitive megacaps like Nvidia, Meta Platforms, and Apple, leading to drops ranging from 0.9% to 3.1%.

Chip stocks, including Advanced Micro Devices and Micron Technology, also took a hit, each falling over 4%. This decline contributed to a 2.6% drop in the Philadelphia SE Semiconductor Index. Despite slightly higher consumer price data reported on Tuesday, which typically dampens rate-cut expectations, the benchmark S&P 500 had reached a new record high. Investors remain optimistic about potential rate cuts in the coming months, given the Federal Reserve's projection of easing credit conditions in 2024 and the ongoing resilience of the economy, despite inflation levels surpassing the central bank's 2% target.

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