Early on Thursday, there was increased anxiety on Wall Street regarding the direction of the Federal Reserve’s interest rate policy and whether policymakers would implement another hike this year. As a result, stock futures declined.
The Dow Jones Industrial Average futures dropped 92 points, or 0.27%. Nasdaq futures fell 0.54% and S&P 500 futures dipped 0.36%.
During regular trading hours, technology companies underperformed the market the most, with the Nasdaq Composite closing 1.1% lower and recording its third straight losing session. Apple and Nvidia both had declines of more than 3%, pulling the tech-heavy index down.
Higher Treasury yields put pressure on tech companies and increased market apprehension that the Federal Reserve will use recent, stronger-than-anticipated economic statistics as justification for raising benchmark lending rates to fight inflation. The 2-year Treasury note’s yield increased by as much as 6 basis points on Wednesday.
According to a survey released on Wednesday, the pricing component of the Institute for Supply Management’s U.S. services index increased to 58.9% in August, reaching a six-month high. Prices as measured by the ISM index rose to a four-month high.