The S&P 500 Index closed down 0.71% on Tuesday, marking a four-week low, while the Dow Jones Industrial Average fell 0.79% to a one-month low, and the Nasdaq 100 dropped 1.29%, reaching a one-week low. This decline came amid rising oil prices, which have spurred inflation concerns and elevated bond yields, prompting fears that central banks will continue to raise interest rates. The UK 10-year Gilt yield surged to 5.25%, its highest in 18 years, while the German 10-year Bund reached a 15-year high of 3.36%.
Economic data released on Tuesday showed the US August ISM manufacturing index fell to 54.6, below expectations of 55.2, and construction spending for July decreased by 0.5%, against predictions of no change. Additionally, JOLTS job openings rose unexpectedly by 89,000 to 7.271 million but remained below the expected 7.313 million. The market is discounting a 69% chance of a 25 basis point rate hike at the upcoming Federal Open Market Committee meeting scheduled for September 15-16.
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