STOCK EXCHANGE: Wall Street opened to a decline – Long-term interest rates at their highest level in almost 20 years

The US stock market opened lower on Tuesday, as interest rates on long-term government bonds rose to their highest levels in nearly 20 years. The yield on the 30-year bond had risen to 5.194 percent, the highest level since 2007.

The general index S&P 500 opened down 0.8 percent and the technology-focused Nasdaq 100 index opened down 1.3 percent. If the downward trend holds at the end of the day, it will be the third consecutive day of decline for the S&P 500 index.

The strategists’ views on the direction of the rest of the year are strongly divided. Yardeni Research Ed Yarden reminds that a stagflation-like macro environment does not necessarily depress the stock market, if companies are able to take care of their profit margins.

Wells Fargon Ohsung Kwon on the other hand, warns about the second half of the year. He reminds us that historically the S&P 500 index has fallen by more than ten percent in the latter half of midterm election years, with a probability of up to 71 percent.

However, there was positive data from the housing market in the United States, as pending housing transactions increased by 1.4 percent to a five-month high, i.e. to an index figure of 74.8. The median of consensus forecasts collected by the news agency Bloomberg expected a one percent increase compared to March.

Within the technology sector, a clear sector rotation was seen on Tuesday, as software companies rose to support the market in fear of the artificial intelligence disruption at the beginning of the year. However, semiconductor stocks fell.

The iShares Expanded Tech-Software Sector etf fund, which follows the software sector, was quoted up more than two percent. Director of Research at Fundstrat Thomas Lee considers the risk-reward ratio of software very attractive due to the significant underperformance seen since September.

Investors’ focus is on Nvidia’s interim report tomorrow. The company’s price was quoted on Tuesday with a decrease of 1.4 percent.

A sports brand company that was once listed on the Helsinki Stock Exchange Amer Sports opened to an increase of more than six percent. The company exceeded the profit expectations for the first quarter and at the same time raised its guidance for the whole year.

According to Bloomberg, SpaceX aims to file its long-awaited IPO application, possibly as early as Wednesday.