U.S. stocks tumbled with the Dow shedding over 700 points, as Treasury yields unexpectedly climbed despite the Treasury Department’s large-scale debt buyback operation, signaling persistent concerns over higher borrowing costs. The market was further pressured by a steep 9% drop in Walmart shares following a disappointing earnings report, alongside rising oil prices fueled by escalating U.S.-Iran geopolitical tensions.
U.S. equities experienced a significant downturn as Treasury yields defied the Treasury Department's efforts to curb them, marching higher and casting a shadow over the ongoing bull market with concerns about elevated borrowing costs.
The Dow Jones Industrial Average plummeted by 703.84 points, or 1.32%, primarily due to a steep 9% decline in Walmart shares, closing at 52,759.21. The S&P 500 also fell, shedding 0.87% to end at 7,641.16, while the Nasdaq Composite saw a 1% drop, settling at 26,067.17.
Bond yields escalated on Thursday, with the 10-year Treasury note yield climbing above 4.704%, gaining over 5 basis points. This occurred despite the Treasury Department's announcement on Wednesday to significantly increase repurchases of longer-term debt. Treasury Secretary Scott Bessent even hinted to CNBC that the buyback operation could exceed the initial $4 billion target. The 30-year Treasury bond yield added more than 5 basis points, reaching 5.248% and spiking to its highest level in almost two decades earlier in the week.
However, skepticism lingers. Adam Phillips, managing director of investments at EP Wealth Advisors, expressed doubts about the buyback program's long-term effectiveness, stating, "This is not the cure to what ails the bond market. There are structural forces here at play that are really beyond the Treasury and the administration's control."
Adding to market pressures, oil prices surged amidst escalating tensions between Iran and the U.S. President Donald Trump declared "economic warfare" against Iran on Truth Social, vowing "the TOUGHEST SANCTIONS IN HISTORY." West Texas Intermediate crude for October delivery rose almost 3% to $86.83 per barrel, and global benchmark Brent crude futures gained over 2% to $93.78 a barrel.
Walmart's disappointing performance, including U.S. comparable sales missing analyst expectations and a lowered adjusted earnings forecast for the third quarter and full year, contributed significantly to the broader market's decline. This marked Walmart's worst day in over four years.
Market Wrap-up & Company Updates:
Stocks Fall Thursday
The three major U.S. indexes concluded Thursday's trading in negative territory. The S&P 500 declined 0.87% to 7,641.16, the Nasdaq Composite dropped 1% to 26,067.17, and the Dow Jones Industrial Average lost 703.84 points (1.32%) to close at 52,759.21. — Sean Conlon
Target's Progress Tangible, Says Truist
Truist Securities noted that Target's recent earnings, which surpassed expectations and included raised guidance, show tangible progress in the retailer's turnaround. Analyst Scot Ciccarelli maintained a hold rating, observing that Target's investments in price, labor, store standards, and merchandising are resonating with customers. — Michelle Fox
JPMorgan Gives Overweight Rating to Chipmaker Broadcom
JPMorgan upgraded Broadcom to an overweight rating, believing the market underestimates the chipmaker's potential, especially in AI sales. Analyst Harlan Sur highlighted Broadcom's "significant dominance/lead" and strong partnership with Alphabet. — Tobias Burns
Deere Stock Jumps After Recording $1.4 Billion Profit
Deere shares rose approximately 6% after the agricultural and construction equipment manufacturer reported better-than-expected quarterly results, posting a $1.38 billion profit and raising its full-year profit outlook. CEO John C. May expressed confidence in the company's long-term value creation. — Deena Zaidi
Walmart Shares on Pace for Worst Day Since May 2022
Walmart's stock declined nearly 9% during Thursday's trading, marking its worst performance since May 2022, following disappointing U.S. comparable sales and adjusted earnings forecasts. — Sean Conlon and Nick Wells
JPMorgan Reiterates Overweight on Analog Devices
JPMorgan maintained an overweight rating on Analog Devices, citing strong third-quarter earnings and an expectation that data center growth will exceed current projections. — Sarah Min
Treasury Buyback Operation Could Be More Than $4 Billion, Bessent Says
Treasury Secretary Scott Bessent stated that the government's accelerated debt buyback could be larger than the initially announced $4 billion, aiming to "make a market" in longer-dated securities. — Jeff Cox
TD Cowen is a Hold on Merck Despite Cancer Vaccine Success
Despite positive Phase III trial results for Merck's cancer vaccine, TD Cowen maintained a hold rating, suggesting the success was anticipated and the full market breadth remains uncertain. — Tobias Burns
Stocks Open Lower
U.S. major averages opened lower on Thursday, with the Dow losing 421 points, the S&P 500 down 0.4%, and the Nasdaq Composite falling 0.5%. — Sean Conlon
Philadelphia Manufacturing Gauge Hits Highest Since April 2021
Factory activity in the Philadelphia area reached a five-year high in August, with the Philadelphia Fed's manufacturing index jumping to 47.4. Employment also surged, though price gauges hit their lowest levels since February amidst geopolitical tensions. — Jeff Cox
Bitcoin Tops $71,000 to Hit Highest Levels Since June
Bitcoin surged nearly 11% over two days, surpassing $71,000, its highest since June, following President Trump's push for crypto-friendly legislation. Ether and Solana also reached recent highs. — Nick Wells and Davis Giangiulio
Walmart, Coinbase and Alibaba Among the Stocks Making Premarket Moves
- Walmart: Dropped approximately 6% premarket due to missed U.S. comparable sales and weak earnings guidance.
- Crypto stocks (Coinbase, Mara Holding, Strategy, Circle Internet, American Bitcoin): Rose 5-10% following Bitcoin's surge and Trump's support for crypto legislation.
- Alibaba: U.S.-listed shares fell nearly 3% after reporting a 75% drop in profits due to AI spending.
— Michelle Fox
Here's the Latest Ahead of the Opening Bell on Wall Street
S&P 500 futures were flat. Bond yields edged higher despite Treasury buyback plans. Oil prices rose due to Trump's "economic warfare" rhetoric against Iran. Gold pulled back after a 4% gain. — Joseph Wilkins
Treasury Yields Edge Higher
Bond yields advanced as investors assessed the Treasury's debt buyback plan. The 30-year U.S. Treasury yield was up 2 basis points at 5.2224%, and the 10-year yield moved 1 basis point higher to 4.6723%. — Hugh Leask
Oil Rises More Than 2% as Trump Sharpens Iran Rhetoric
Oil prices increased over 2% amidst rising tensions between the U.S. and Iran, with Brent crude at $93.61 and WTI futures at $87.56. The UAE also suspended trade with Tehran. — Hugh Leask
Danish Biotech Novonesis Shares Pop 8% After Raising Outlook, €1 Billion Buyback
Novonesis shares jumped 8% after the Danish biotech firm boosted its full-year guidance and announced a €1 billion share buyback program. — Joseph Wilkins
Asia-Pacific Markets Close Higher, Sentiment Supported by Wall Street Gains
Asian markets, including Japan's Nikkei 225, South Korea's Kospi, and Australia's S&P/ASX 200, closed higher, bolstered by gains in tech stocks and positive sentiment from Wall Street. — Justina Lee
European Stocks Open Broadly Flat as Investor Sentiment Remains Muted
European markets, including the Stoxx 600, FTSE 100, CAC 40, and DAX, opened largely flat due to subdued investor optimism. Healthcare stocks saw gains, while miners and travel/leisure sectors lagged. — Joseph Wilkins
Gold Pares Gains as Investors Take Profit After Strong Wednesday Session
Gold prices retreated slightly after a 4% surge on Wednesday, driven by the U.S. Treasury market intervention which weakened the dollar. Spot gold traded at $4,491.75 per ounce. — Joseph Wilkins
SK Hynix Shares Surge Over 12% in Seoul Following Massive Stock Buyback Plan
SK Hynix shares soared over 12% in Seoul after announcing an accelerated 40 trillion won ($28.7 billion) share repurchase program and expanded shareholder returns, fueled by demand for AI components. — Justina Lee
Asian Tech Stocks Track Wall Street Gains as U.S. Move to Rein in Treasury Yields Lifts Sentiment
Asian technology stocks, including SK Hynix, Samsung Electronics, SoftBank Group, and Nintendo, rebounded significantly on Thursday, tracking Wall Street's gains after U.S. Treasury yields pulled back. — Justina Lee
Mainland China and Hong Kong Shares Open Higher
Mainland China and Hong Kong equities opened higher, mirroring positive trends in other Asian markets, with Hang Seng and CSI 300 both seeing gains. — Justina Lee
Korea Exchange Halts Trading Briefly on Kospi as Index Jumps Over 5%
The Korea Exchange briefly halted program trading on the Kospi index after it surged over 5%, triggering a buy-side sidecar. — Justina Lee
South Korea's Kospi Leads Gains as Asia-Pacific Markets Open Higher
Asia-Pacific markets opened strong, with South Korea's Kospi leading gains, advancing over 3%, followed by Japan's Nikkei 225 and Australia's S&P/ASX 200. — Justina Lee
Asia-Pacific Markets Set to Open Higher, Tracking Wall Street Gains
Asian markets, including Japan's Nikkei 225, Hong Kong's Hang Seng index futures, and Australia's S&P/ASX 200, were poised for a higher open, encouraged by Wall Street's recovery and a pullback in U.S. Treasury yields. Geopolitical tensions involving President Trump's "economic warfare" against Iran continued to be a significant factor. — Justina Lee
Bitcoin Continues Its Climb in After-Hours Trading; Crypto-Related Stocks Rise
Bitcoin's surge continued into Wednesday night, rising about 7% to above $69,000. This rally, along with gains in crypto-related stocks like Coinbase and Robinhood, was spurred by a risk-on sentiment following the Treasury's bond buyback announcement. — Darla Mercado
U.S. Government Debt Tops $40 Trillion
The U.S. national debt surpassed $40 trillion on Tuesday, marking another concerning milestone driven by years of escalating budget deficits and pandemic-related stimulus spending. — Jeff Cox
Precision Engineering Stock Nordson Surges in Extended Trading
Nordson, a manufacturer of coating and adhesive equipment, saw its stock rise 8% in extended trading after increasing its full-year earnings guidance above analyst expectations. — Darla Mercado
Here's Where the Major U.S. Stock Averages Closed on Wednesday
- Dow Jones Industrial Average: up 119.65 points, or 0.2%, at 53,463.05.
- S&P 500: up 0.2% at 7,707.98.
- Nasdaq Composite: up 0.2% at 26,331.09.
— Fred Imbert
S&P 500 Futures Open Marginally Higher
U.S. stock futures showed slight gains on Wednesday evening, with S&P 500 futures up 0.1% and Nasdaq 100 futures gaining 0.3%. — Darla Mercado
