US stocks waver as chaotic bond rout cools and investors find new footing

Traders nervous watching world cupBrendan McDermid/ReutersTraders and workers watch the U.S.-Germany 2014 World Cup soccer match on the floor of the New York Stock Exchange June 26, 2014.
  • US equities traded mixed on Friday as bond yields reversed recent gains and tech stocks bounced back slightly.
  • The tepid session marks a shakeup from the volatile selling seen earlier in the week that was sparked by soaring Treasury yields.
  • GameStop leaped for a third straight session as online day traders aimed to replicate January’s massive rally.
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US stocks fluctuated on Friday as the week’s sell-off in bonds eased and investors looked to recoup heavy losses.

Major indexes are on track for one of their worst weeks since the pandemic first slammed markets in March 2020. Investors dumped Treasurys throughout the week amid hopes that Democrat-backed stimulus would fuel stronger-than-expected inflation. The surge in bond yields jolted the stock market, with high-flying tech names tumbling the most. 

The week’s trend reversed slightly on Friday. Treasury yields dipped from one-year highs, offering a reprieve for equities investors overwhelmed by recent sessions’ selling. Tech stocks retraced some losses, though indexes still sit well below levels seen at the start of the week.

Here’s where US indexes stood after the 4:00 p.m. ET close on Thursday:

Federal Reserve Chair Jerome Powell indicated Tuesday the rise in bond yields signaled investors are pricing in a “robust and ultimately complete recovery,” seemingly unperturbed by the rate of the Treasury sell-off. The chair reiterated that inflation remains far from the levels needed to justify tightening the ultra-loose policy that helped drive stocks higher last year.

“Policymakers may be perfectly comfortable with what’s happening,” Craig Erlam, senior market analyst at Oanda Europe, said. “Investors should not need the central bank to hold their hand much longer and I expect by the end of the year, taper discussions will and should be starting.”

GameStop rose for a third straight day as day traders uniting in online forums looked to repeat the volatile rally seen one month ago. Posts on r/wallstreetbets cheering the rally soared to the top of Reddit’s “Popular” page Thursday afternoon, suggesting the cohort of retail investors are once again working to collectively drive the stock sharply higher.

Other meme stocks popular with the online community saw less love, with AMC, BlackBerry, and Nokia all declining.

Beyond Meat surged after new partnerships with McDonald’s and Yum Brands offset concerns over weaker-than-expected quarterly sales.

Virgin Galactic tumbled after the space-tourism company again delayed a critical test flight. The postponement led the firm to push back commercial service to 2022.

Bitcoin slumped to around $US46,000 ($59,222) after trading as high as $US51,564 ($66,385) one day prior. The popular cryptocurrency is on pace for its biggest weekly slide since last March.

Spot gold slid 0.85%, to $US1,755.45 ($2,260) per ounce, at intraday lows. The US dollar strengthened against a basket of Group-of-20 currencies. The 10-year Treasury fell to 1.465%, down from the 1.614% peak seen the session prior.

Oil prices declined. West Texas Intermediate crude fell as much as 2.7%, to $US61.8 ($80) per barrel. Brent crude, oil’s international benchmark, dropped 1.8%, to $US65.7 ($85) per barrel, at intraday lows.

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