PiCK
US Stocks End Slightly Higher After 10-Year Treasury Yield Hits 5.34%; Chip Shares Gain on Micron
Forecast Trend Report by Period
U.S. stocks closed slightly higher after Treasury yields gave up part of their intraday surge, with the 10-year note yield touching its highest level since 2002. Semiconductor shares outperformed on strong Micron results.
On Oct. 1, the Dow Jones Industrial Average rose 20.51 points, or 0.04%, to 50,926.56 on the New York Stock Exchange. The S&P 500 gained 14.91 points, or 0.19%, to 7,666.45, while the Nasdaq Composite added 10.53 points, or 0.04%, to 26,871.60.
Treasury yields were the main driver of trading. The benchmark 10-year U.S. Treasury yield climbed as high as 5.342% during the session, marking another high since 2002. Government bond yields in major European markets including the U.K. and France also rose, increasing selling pressure on risk assets earlier in the day.
The mood shifted in the afternoon as buyers returned to the bond market. Investors increasingly viewed the recent jump in yields as excessive, while the U.S. Treasury's buyback operation also helped calm bond-market nerves.
The Treasury received $46.39 billion in offers in a buyback operation targeting Treasuries with maturities of 10 to 20 years, and bought back $6 billion.
Concerns about additional Federal Reserve rate hikes also eased somewhat. CME FedWatch showed the federal funds futures market priced in a 74.0% chance the Fed would leave rates unchanged in October, up from 62.4% a day earlier.
Semiconductor shares were led higher by Micron. The Philadelphia Semiconductor Index rose 1.59%. Micron gained 3.03%, SanDisk climbed 2.75%, Nvidia added 1.09% and TSMC rose 0.66%. American depositary receipts of SK Hynix also jumped more than 5%.
Micron's second-quarter revenue and its forecast for the current quarter both topped market expectations, helping spur buying across the broader chip sector.
International oil prices surged on supply concerns. News that China had halted refined-product exports and the possibility of an additional U.S. troop deployment to the Middle East pushed crude higher.
On ICE Futures Europe, December Brent crude settled 4.37% higher at $102.31 a barrel. On the New York Mercantile Exchange, November West Texas Intermediate crude rose 2.71% to $92.87 a barrel.
