The U.S. stock market fell across the board as expectations for further interest rate hikes by the Federal Reserve strengthened and U.S. Treasury yields surged.
On September 23, the Nasdaq Composite Index, heavily weighted with technology stocks, closed down 308.24 points (1.13%) at 26,936.04 on the New York Stock Exchange (NYSE).
The S&P 500 index fell 58.61 points (0.75%) to finish at 7,706.03, while the Dow Jones Industrial Average dropped 352.10 points (0.68%) to close at 51,511.59.
Market participants were focused on the rising U.S. Treasury yields and the potential for additional rate hikes by the Fed. The yield on the benchmark 10-year Treasury note rose by 0.17 percentage points during the day to reach 5.13%, marking its highest level since July 2007. The yield on the 5-year note also increased by about 0.20 percentage points to surpass 5% for the first time since 2007.
The 10-year Treasury yield recorded a significant increase of 13.89 basis points (1 basis point = 0.01 percentage points) to reach 5.106%, the highest since 2007. This daily increase was the largest since the so-called 'Day of Liberation' in April 2025, when former President Donald Trump announced sweeping tariffs that caused market turmoil.
Comments from a senior Fed official added to the market's concerns. Michael Barr, a Fed governor, stated at an event in Chicago that "there is a strong possibility that additional policy adjustments will be necessary to bring inflation down to target levels in a timely manner."
As a result, expectations for further rate hikes have quickly intensified. According to the CME FedWatch tool, market participants are pricing in about a 70% chance of a rate increase next month.
Fed policymakers are increasingly worried that inflation has not returned to the target rate of 2% for over five and a half years. Bloomberg analysts noted, "Strong growth, persistent inflation, uncertainty surrounding energy market interventions, and a hawkish Fed have created nearly perfect conditions for rising interest rates."
* This article has been translated by AI.
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