Name: Nasdaq Composite narrowly avoids first correction in 6 months as Powell stirs up stock-market rout and Treasury-yield surge
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Nasdaq Composite narrowly avoids first correction in 6 months as Powell stirs up stock-market rout and Treasury-yield surge

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A sluggish day in stocks on Thursday took a turn decidely lower following comments from Federal Reserve Chairman Jerome Powell said that he was monitoring a steady climb in yields but failed to provide any guidance on what the central bank might do if yields continued to climb precipitously. Speaking at a webinar hosted by the Wall Street Journal on Thursday after noon, Powell described the Fed's current policy stance as appropriate, perhaps disappointing some investors hoping for more decisive comments on possible adjustments to the central bank's asset purchases. The remarks are credited with triggering a selloff in bonds and stocks, that abated somewhat later in the session, that brought the Nasdaq Composite Indexon the brink of falling by 10% from its recent closing high put in on Feb. 12, meeting the commonly used definition for a correction. The Nasdaq ended the session off 2.1% at 12,723, and is now down 9.73% from that record close. Meanwhile, the 10-year Treasury notejumped by about 7 points to around 1.54%. Rising rates have caused friction in equity trading because it forces investors to reassess the relative value of highflying technology and tech-related plays that have enjoyed a bump during the pandemic, compared against other sectors that might perform better headed into an economic recovery. The S&amp;P 500 indexclosed the session off 1.3% to 3,768, while the Dow Jones Industrial Averagefinished the day off 1.1% at 30,923. Both finished below their 50-day moving averages for the first time in about four or five weeks, Jan. 29 for the S&amp;P 500 and Feb. 1 for the Dow. At the height of Thursday's selling the Dow was down over 720 points, wiping out its year-to-date gains. The Dow remains up 1% for 2021, the Dow is clinging to a 0.3% year-to-date gain, while the Nasdaq Composite is down 1.3% so far this year.Powell reiterated the Fed is unlikely to alter policy until it sees signs that the unemployment rate will drop significantly and that inflation will rise sustainably.

A sluggish day in stocks on Thursday took a turn decidely lower following comments from Federal Reserve Chairman Jerome Powell said that he was monitoring a steady climb in yields but failed to provide any guidance on what the central bank might do if yields continued to climb precipitously. Speaking at a webinar hosted by the Wall Street Journal on Thursday after noon, Powell described the Fed's current policy stance as appropriate, perhaps disappointing some investors hoping for more decisive comments on possible adjustments to the central bank's asset purchases. The remarks are credited...

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Mark DeCambre

MarketWatch is a website that provides financial information, business news, analysis, and stock market data. Along with The Wall Street Journal and Barron's, it is a subsidiary of Dow Jones & Company, a property of News Corp. Notable contributors include Mark Hulbert and Francine McKenna.

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Nasdaq Composite narrowly avoids first correction in 6 months as Powell stirs up stock-market rout and Treasury-yield surge

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