Dow, Nasdaq slip, dragged lower by tech sector: Market Open

The Dow Jones Industrial Average (^DJI) moves over 0.5% lower as the Nasdaq Composite (^IXIC) also drops 0.3% at Wednesday's market open.

Morning Brief host Seana Smith monitors the moves across market indexes, sectors, and the bond market — as the 10-year Treasury yield stretches above 4.2% (^TYX, ^TNX, ^FVX).

Yahoo Finance markets and data editor Jared Blikre also joins the program to help examine market and Treasury trends, noting the S&P 500's (^GSPC) performance going into the 2024 election.

To watch more expert insights and analysis on the latest market action, check out more Morning Brief here.

This post was written by Luke Carberry Mogan.

Video Transcript

Taking a look, though, at the broader picture here with the major averages, we are looking at a bit of pressure here.

Across the board.

You've got the Dow opening off just about a half of a percent off about 230 points, the worst performers of the three major averages here at the Open.

You've got the S and P off just about a third of a percent when you take a look at the NASDAQ composite as it calibrates here off just about a third to 1/4 of a percent here.

So when you take a look at some of the bigger, uh, the headlines driving this morning's market action, actually quickly flipping back over, it's important to point out.

But the activity that's happening right now in the bond market, because that really has been driving some of the overall narrative within the market right now, you got the 10 year yields pushing further up above that 42 level.

We're gonna be talking to a couple of strategies coming up just about the implications of that to the broader market.

So you have the bond market, what's going on there?

Some implications of the election, then taking a look at the earnings picture right now.

And that is really influencing the moves that we're seeing here this morning in terms of the underperformance here, you've got consumer staples.

You got consumer discretionary lagging here, the other sectors, in terms of what is still in the red or what is still in the green.

You've got utilities and financials.

Let's take a look inside the Dow.

A couple of big headlines are driving some of the action that we are seeing.

We gotta take a look at McDonald's and E coli outbreak weighing on shares here this morning.

You're looking at a drop of just about 7% broader implications of that.

We got two downgrades here from the street from Baird and Go and he both revising their outlooks here from from McDonald's that, of course, weighing on shares.

Coca Cola, also out with its results, you're looking at a drop of nearly 3%.

So some disappointment there in consumer facing names.

And we also had Boeing out, uh, with their earnings report, you're looking at a loss of just about 2% here at the open.

So again, a bit of a mixed picture when you take a step back here.

But again, when you take a look at the earnings reports that we're getting the real read on the consumer, some reason to be a big concern me about the trajectory and what we could see.

Growth wise going forward.

Let's get over to Yahoo Finance is Jared Bookery for a closer look at the opening.

Hey, Jared!

Well, thank you, Shana.

We've got the major indices doing some opposite things here.

Let me just explain, because I think overall stocks have been kind of in a holding pattern.

We're drifting up sometimes hitting new new record highs, but not in a major way.

And we see other indices selling off.

So today we have the NASDAQ composite.

This is year to date.

Happens to have been up five days straight.

Might be bucking that, so it might be ending that streak.

But that was the same case yesterday morning.

Then you take a look at the S and P 500 up 22.24% this year.

This is the best year since 2013, 204 trading days into the year, and you'll remember just about a month ago.

We are having the best year since 1997.

But suffice to say this is a very productive year heading into an election where we did not.

We did not experience a lot of those downturns that we typically get in September, also going to point out the Russell 2000.

This has just been a frustrating trade for traders.

We have now rejected this potential.

I'm going to call it a resistance line, not potential anymore.

That was resistance.

We have rejected it.

That's a year to day charge.

Just check.

Take a look at the three year and you can see it has been a long time forming this round base here and it might not be done.

It might take another few months.

It might take a few years to break out, but you do have this pattern in place.

So that's what we're watching.

And Sha, I think very astute to focus on the bond market.

I'm going to dial this down to a three month chart and you can see we've actually gone nowhere in three months, just up slightly.

But 4.24% in the time that stocks really haven't been doing much.

We have seen bond yields going higher, and a lot of when the bond market moves and you don't see stocks reacting that much.

Sometimes there is a delayed reckoning.

So that's something I'm watching out for as well in concert with the US dollar, when you have yields heading higher, especially longer term yields with the dollar, that is not necessarily what you would expect in a Fed cutting cycle, at least not something that would last because the Fed is going the opposite way.

But that is a very, very steep trend line for the US dollar index, so we got to pay attention to that.

All right.

Looking at the sector action, I was looking before the market.

Tech was lagging.

It looks like consumer discretionary and tech are the two worst sectors, and we can call that a retail trade because consumer staples down about one third of a percent as well utilities is the outperformer here, up about 7/10 of a percent.

And if we take a look at the leaders solar, solar energy and Korean stocks, those are the two top ones in the green Bitcoin having a little bit of a rough.

It rejected 70,000 a few days ago.

Uh, cannabis stocks were jumping yesterday, not today, but all in all, just kind of muted action for the most part, with some outliers in individual names.

And then finally, just taking a look at the NASDAQ 100.

Uh, meta is in the green, Texas Instruments up 3% but for the most part, a lot of red here.

I lied a second ago because this is the last screen.

I do want to check out soil, which has been hitting record highs recently.

But it is selling off today, just slightly hit $35 an ounce.

And that seems to be some kind of psychological inflexion point.

I'm going to put the 20 year chart back on.

This has just been a long, long, another long time consolidation.

But the difference between that and the chart I just showed showed a few minutes ago is we broke out of a base.

And so there is some momentum to the upside.

And despite what's happening today for that from that $35 price, looks like there's room to run here in silver