U.S. equity markets remained under pressure Friday morning as the 10-year yield held near its highest level in a year.
The Dow Jones Industrial Average pared some of its losses after falling 450 points, while the S&P 500 was little changed and the Nasdaq Composite rose 0.6%.
10-Year Treasury in focus
The selling comes as the 10-year yield remained near a one-year high of 1.51%. The recent rise in bond yields has caused panic among investors worried about a return of inflation. Strategists have suggested the 10-year’s move above the 1.5% level, which equates to the dividend yield of the S&P 500, could put more pressure on equities.
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Looking at stocks, Johnson & Johnson’s one-shot COVID-19 vaccine is expected to receive approval from a Food and Drug Administration panel, paving a way for distribution to begin next week.
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GameStop Corp. shares were indicated to open higher after soaring 142% over the previous two sessions. However, other stocks that have been subject to heightened volatility, like AMC Entertainment Holdings Inc., Bed Bath & Beyond Inc. and Koss Corp., were experiencing more muted trading activity.
Elsewhere, Twitter Inc. outlined plans to double revenue by 2023 with features such as tipping and paid subscriptions to “super follow,” or access exclusive content, from some accounts.
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In earnings, Salesforce.com Inc. reported earnings and revenue that outpaced expectations but raised its full-year revenue forecast to below what Wall Street had been anticipating.
DraftKings Inc. reported pro-forma revenue, rose 98% year over year in the three months through December, supported by a favorable sports calendar and strong customer engagement. The sports-betting platform raised its 2021 revenue forecast to between $900 million and $1 billion, up from $750 million to $800 million. Other gaming stocks are in focus.
In commodities, West Texas Intermediate crude oil slid $1.59 to $61.94 per barrel and gold sank $45.30 to $1,730.10 an ounce.
In Europe, Britain’s FTSE 100 was trading lower by 2.3% while France’s CAC 40 and Germany’s DAX 30 were weaker by 1.39% and 0.65%, respectively.
Markets were hit hard across Asia with Japan’s Nikkei 225 plunging 3.99%, Hong Kong’s Hang Seng index losing 3.64% and China’s Shanghai Composite declining 2.12%.