New York: U.S. stock indexes opened lower on Tuesday as technology stocks were slammed by rising Treasury yields, while Goldman led declines among big banks after missing profit expectations.
Goldman Sachs said its fourth-quarter profits fell by 13 percent from a year earlier, largely due to the bank preparing to pay out hefty pay packages to staff.
Microsoft is also falling after saying it will buy videogame maker Activision Blizzard for nearly $69 billion.
The Dow Jones Industrial Average fell 250.05 points, or 0.70 percent, at the open to 35,661.76. The S&P 500 opened lower by 30.61 points, or 0.66 percent, at 4,632.24, while the Nasdaq Composite dropped 211.92 points, or 1.42 percent, to 14,681.83 at the opening bell.
Rate-sensitive tech stocks came under pressure as two-year Treasury yields, which track short-term rate expectations, crossed 1 percent for the first time since February 2020. Rising bond yields tend to put pressure on stocks, as investors reassess their asset allocations and take a closer look at share prices, especially higher valued ones.
Later in the week, a US Senate panel is set to debate a bill that aims to rein in app stores of companies that some lawmakers say exert too much market control, including Apple and Alphabet’s Google.
A monthly survey conducted by Deutsche Bank found that a majority of respondents believed US technology stocks are in a bubble as investors remained more bearish on hawkish policy moves and higher yields.
