Stock Indexes Decline on Rising Long-Term Treasury Bond Yields

Brian Mackey, deputy director of research at Adviser Investments, has the market analysis for Thursday, October 4. Despite rallying from steeper losses earlier in the day, all major U.S. stockA financial instrument giving the holder a proportion of the ownership and earnings of a company. indexes closed the day down, with the Dow Jones Industrial Average and S&P 500 falling 0.2% and the NASDAQ sliding 1.8%. Rising long-term Treasury bondA financial instrument representing an IOU from the borrower to the lender. Bond issuers promise to pay bond holders a given amount of interest for a pre-determined amount of time until the loan is repaid in full (otherwise known as the maturity date). Bonds can have a fixed or floating interest rate. Fixed-rate bonds pay out a pre-determined amount of interest each year, while floating-rate bonds can pay higher or lower interest each year depending on prevailing market interest rates. yieldsYield is a measure of the income on an investment in relation to the price. There are several ways to measure yield. The current yield of a security is the income over the past year (either dividends or coupon payments) divided by the current price., which are currently experiencing multiyear highs, partially contributed to that sell-off over concern that investors may begin to shift money from the stock to bond market. Meanwhile, Constellation Brands advanced more than 5% after the company beat quarterly earnings expectations and raised its full-year forecast.