Jim Cramer’s top 10 things to watch in the stock market Tuesday
Jim Cramer's top 10 things to watch in the stock market Tuesday. In this articleUS10YUS20YUS30YFollow your favorite stocksCREATE FREE ACCOUNTTreasury yields continued to rise sharply across the curve on Tuesday, sending the yield on the benchmark 10-year note above the closely watched 5% level.
What happened
The relationship between stocks and bondsWhile the moves in the bond market fueled questions about what's in store for the Federal Reserve's two-day September meeting – which begins Tuesday – they also raised concerns about the outlook for global equities. Skip NavigationMarketsBusinessInvestingTechPolitics & PolicyVideoWatchlistInvesting ClubPROLivestreamMenuIn this articleBTC. Graeme Sloane | Bloomberg | Getty ImagesThe Senate on Tuesday voted to block the Clarity Act from advancing, dealing a major blow to the crypto industry's push for a comprehensive market structure framework.
Strong earnings growth has cushioned the stock market from rising yields. Skip NavigationMarketsBusinessInvestingTechPolitics & PolicyVideoWatchlistInvesting ClubPROLivestreamMenuKey PointsThe yield on the 10-year U. Stocks slipped in European and Asian trade on Tuesday, while U. In the bond market, assets have come under pressure from the economic fallout of the Iran war, growing anxiety about mounting government debts and other fiscal concerns. watch nowVIDEO6:1106:11'Pain point' for U.
The wider picture
Fed in focus However, some market watchers appear undeterred by rising rates. "Carol Schleif, chief market strategist at BMO Wealth Management, said in an email on Tuesday that the Fed has "little choice but to hike rates" this week, since the bond market has been "signaling for weeks that higher rates are warranted. "With hot inflation data, strong corporate earnings and a sturdy labor market also at play, Schleif said the stock market would be disappointed if the central bank didn't raise interest rates, noting that elevated energy prices and geopolitical concerns meant high yields "could be here to stay for some time.
This is one of the reasons why the stock market has handled yields creeping higher – the rise comes from a place of fundamental strength rather than a wage-price push," she said. CM=CRCLFollow your favorite stocksCREATE FREE ACCOUNTThe Capitol in Washington, Jan. "The price of bitcoin was last down 3%, while Coinbase and Circle shares slid 8% and 10%, respectively, amid the broader market sell-off. For the crypto industry, the significance of Tuesday's vote was on whether the act could move forward for Senate debate and consideration.
Cynthia Lummis, R-Wyo. , the top champion of the crypto industry in the Senate, told reporters earlier Tuesday that "it's over" if the Clarity Act procedural vote failed.
What has been reported
Tuesday's vote might pave the way for Fairshake, a crypto political action committee, to donate to candidates running against senators who voted to block the Clarity Act. Treasury broke above the 5% mark on Tuesday, after briefly rising above 5% the previous day. Investors told CNBC what the implications of a 10-year yield higher than 5% could be for equity markets. S. stock futures pointed to a negative open after a losing session the previous day. "Equities typically appreciate alongside rising bond yields when the market is raising its expectations for economic growth but struggle when yields rise due to other drivers, like fiscal concerns," Goldman Sachs Research Chief U.
S. yields: Tikehau CapitalSquawk Box EuropeIn a note on Tuesday morning, Barclays strategists said higher rates had already pressured valuations and were increasingly putting equity portfolios at risk. In a note Tuesday, the BlackRock Investment Institute said that although higher global rates are "raising the hurdle for returns" on equities, they "have not knocked us off our pro-risk stance. "We expect chop over the next few weeks in stocks until we are solidly back into earnings season and have fundamentals to lean into," she added.
What happens next
"Stocks are likely to remain volatile through the fall season thanks to high oil prices, bond yields, midterm election uncertainty and the fact that stocks are only slightly off of their all-time highs and are due for a more meaningful pullback of 10%. "Florian Spaete, Senior Bond Strategist at Generali Investments, told CNBC in an email Tuesday that the break above 5% in the 10-year U. "It signals that markets are demanding a higher term premium for persistent inflation, fiscal risks, heavy issuance and rising capital demand, rather than treating the sell-off as a temporary overshoot," he said.
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The report has been compiled by The Daily Waves using information reported across cnbc.com, marketwatch.com, wired.com. Details are presented according to the information available at the time of publication and may change as authorities, organisers or other relevant parties provide updates.