Market jitters persisted again on Thursday. Nasdaq (QQQ) ended the day down by 0.50%, recovering from losses earlier in the day. The Dow Jones (DJI), S&P 500 (SPY), and Russell 2000 (IWM) also fell. The last few days of declines are potentially market noise. The uptrend that started after the massive Liberation Day Tariffs on April 2 has not broken down yet.
On Oct. 1, the U.S. government might shut down this time. The last shutdown was in 2018/2019. This time, prediction market site Polymarket assigned odds of over 75% of this happening. The White House raised the stakes this time: it threatened mass firings if the government shuts down.
Ahead of the Supreme Court ruling on the legality of tariffs by November, President Trump announced on Truth Social that he plans to impose more tariffs on Oct. 1. To force manufacturers back to the U.S., he plans to impose tariffs on imported kitchen cabinets, bathroom vanities, pharmaceutical products that are imported, and heavy trucks.
Bond Yields Rose
Short-term bond yields rose after the BEA posted a 3.8% growth rate in the second quarter. This is far higher than preliminary estimates. Previously, the Q2 estimate was 3.3% and 3.0% from the initial estimate.
Higher yields lower the attractiveness of holding stocks. Investors would demand a higher risk premium as yields rise. On Thursday, Oracle (ORCL) led the weak markets by falling 5.55%. Tesla (TSLA) lost 4.38%. IBM (IBM), however, gained 5.2% while Intel (INTC) added 8.87%.
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