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Stocks snap two-day winning streak as 10-year yield hits highest level since 2008

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Stocks fell on Wednesday as Wall Street struggled to extend its rally amid a sharp rise in government interest rates.

The Nasdaq Composite lost 0.85% to close at 10,680.51. The S&P 500 ticked down 0.67% to 3,695.16. The Dow Jones Industrial Average fell 99.99 points, or 0.33%, to end the day at 30,423.81. The losses ended a two-day winning streak, although all three averages are still up for the week.

Earnings season has gotten off to a solid start, but Treasury yields remained high on Wednesday, suggesting recession fears remain intact. The 10-year Treasury yield traded as high as 4.136%, the highest level since July 23, 2008.

“If you keep things simple and say the 10-year Treasury is the risk-free rate that basically most other asset classes in the world are priced at … that’s going to cause choppy markets across the board,” Keith Lerner, co-CIO and market strategist at Truist Advisory Services, said of the volatility in the bond market.

“The market is generally hanging in there a little bit, I wouldn’t say good, but not as bad as it could be given that 4% is a line of demarcation that has really pressured stocks,” Lerner added.

The impact of higher prices is showing strongly in the housing market, where housing starts fell faster than expected in September, the Census Bureau said Wednesday.

The interest rate movement also weighed on more speculative technology stocks. Among the biggest losers on the Nasdaq were Chinese tech stocks, which fell more than 7%, and Baidu, which sank 8.8%.

The declines for the broader market came even as Netflix shares rose more than 13% after the streaming giant posted revenue and earnings that beat estimates, as well as strong subscriber growth for the third quarter. United Airlines climbed nearly 5% after the quarter also beat estimates on the top and bottom lines.

Read today’s market coverage in Spanish here.

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