Stocks fell as US stock markets reopened from the Easter long holiday on Monday and investors worried that the Federal Reserve would continue to raise interest rates.
The S&P 500 fell 0.8 percent in early trading, while the heavy Nasdaq Composite fell 1.1 percent.
Monday marks the first opportunity for traders to react to data released on Friday showing continued strength in the US labor market.
Traders believe the US economy added 236,000 new positions last month, less than in February but not slow enough to dissuade the central bank from raising interest rates again to curb inflation.
Investors initially ignored warnings at the latest Federal Reserve policy meeting that the central bank would raise interest rates at least once to control rising prices. However, futures markets are now up 73 percent wide for a rate hike at next month’s meeting.
Treasury markets, which were open on Friday, had already sold off in response to the jobs data and prices fell further on Monday morning. The yield on the benchmark 10-year note rose 0.01 percentage point to 3.40 percent, while the two-year yield added 0.01 percentage point to 3.98 percent. Yields go up when prices go down.
Traders will be watching closely for further signs of the likely direction of monetary policy later this week when the Bureau of Labor Statistics publishes updated consumer inflation figures. The first-quarter earnings season also kicks off in earnest with results from a string of leading financial groups, including JPMorgan Chase.
Economists expect inflation to decline to an annual rate of about 5.2 percent and a monthly rate of 0.3 percent, a level that Citi analyst Stuart Kaiser said “represents a moderate slowdown…but remains too high for comfort and a likely negative reading for stocks.” “.
European markets remained closed for Easter Monday. Hong Kong has also been locked down. The Japanese Topix index added 0.6 percent.