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Jobless Claims Hit 3-Year Low, Bond Yields Spike
6 Dec
Summary
- US jobless claims unexpectedly fell to a three-year low.
- Higher bond yields pressured stock indexes despite some positive corporate news.
- President Trump plans to announce the new Fed Chair in early 2026.
US stock indexes faced downward pressure today, with the S&P 500, Dow Jones Industrials, and Nasdaq 100 all seeing declines. This weakness was largely attributed to rising bond yields, specifically a 3 basis point increase in the 10-year T-note yield to 4.09%. A hawkish signal for Fed policy emerged as initial jobless claims unexpectedly dropped to a three-year low of 191,000.
Adding to market sentiment, reports suggested the Bank of Japan is likely to raise interest rates this month, pushing Japanese government bond yields to an 18-year high and affecting US Treasury prices. Meanwhile, weakness in the chip manufacturing sector weighed on the Nasdaq 100. However, some corporate earnings and forecasts provided pockets of strength, with Dollar General, Meta Platforms, and Hormel Foods showing gains.
In other economic news, US November Challenger job cuts rose year-over-year but were lower than expected. Attention now shifts to Friday's release of September personal spending, personal income, and the core PCE price index, the Fed's preferred inflation measure. President Trump also stated his intention to name the next Federal Reserve Chair in early 2026, with speculation pointing to Kevin Hassett.
