The S&P 500 index fell 2.1% last week, extending the market benchmark’s losing streak to a third consecutive week as bond yields climbed to highs not seen in years.
The index is now down 4.8% for the month of August, but is still solidly in positive territory for 2023 with a year-to-date climb of 14%.
This week’s drop came as Treasury yields rose to multi-year highs; the 10-year Treasury yield hit a 16-year high and the 30-year Treasury yield reached a 12-year high, making stocks look less attractive.
Investors are also concerned about interest rate policy. Minutes released this week from the latest Federal Open Market Committee meeting indicated most committee members saw “significant upside risks” to inflation, which could prompt the central bank to further raise its benchmark lending rate.
All of the S&P 500’s sectors fell last week, led by a 4.1% drop in consumer discretionary, a 3.2% slide in real estate and a 2.8% loss in financials. The smallest decline was posted by the technology sector, which slipped 0.8%.
This week, earnings reports are expected from companies including Lowe’s (LOW), Medtronic (MDT), NVIDIA (NVDA) and Intuit (INTU).
Economic data will feature July existing home sales on Tuesday, followed by July new home sales on Wednesday, along with readings from Standard & Poor’s on the services and manufacturing sectors for August. July durable goods orders are anticipated on Thursday, followed by consumer sentiment data for August on Friday.
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