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Economic conditions

Stocks Fall as Bernanke's Comments Spark Interest Rate Concerns

Strategic Insights

— 1 min read

Yesterday's trading session on Wall Street ended on a sour note as comments from Federal Reserve Chairman Ben S. Bernanke fueled concerns about rising interest rates and inflation. Despite an initial boost from upbeat sales reports and economic data, including a 0.8% rise in personal income and 0.6% increase in spending, the market took a late-day dive as investors became anxious about the prospect of further interest rate increases.

Key Takeaways:

  • The Dow Jones industrial average slid 23.85 points, or 0.21%, to 11,343.29, while the Standard & Poor's 500-stock index dropped 5.42 points, or 0.41%, to 1,305.19.
  • The Nasdaq composite index lost 17.78 points, or 0.77%, to 2,304.79.
  • A barrel of light crude oil added $1.82 to settle at $73.70 on the New York Mercantile Exchange.
  • The yield on the 10-year Treasury note rose to 5.14% from 5.06% on Friday, as investors fled to safety.
  • Wal-Mart Stores' sales at stores open at least a year grew 6.8% in April, beating forecasts.
  • Boeing agreed to buy Aviall, an aircraft parts and services supplier, for $1.7 billion in cash.

Statistics:

  • Dow Jones industrial average: 11,343.29 (-23.85 points, -0.21%)
  • Standard & Poor's 500-stock index: 1,305.19 (-5.42 points, -0.41%)
  • Nasdaq composite index: 2,304.79 (-17.78 points, -0.77%)
  • Yield on 10-year Treasury note: 5.14%
  • Crude oil price: $73.70 (+$1.82)
  • Personal income growth: 0.8% in March
  • Spending growth: 0.6% in March
  • Core prices: 0.3% growth in March, excluding volatile food and energy costs

Sources:

  • "Wall Street's anxiety over interest rates sent stocks moderately lower yesterday..." - (Associated Press)
  • "Fed Chairman Bernanke says future increases would depend mostly on economic data..." - CNBC
  • "Wal-Mart jumps 90 cents, to $45.93, after sales at stores open at least a year grew 6.8% in April..." - (Associated Press)
  • "Boeing agreed to buy Aviall, an aircraft parts and services supplier, for $1.7 billion in cash..." - (Associated Press)

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