US Treasury yields hit their highest level in two years, hit by expectations of a Fed rate hike! Bitcoin dropped $41,000

The high-tech tech continued its sell-off that began earlier this year as U.S. Treasury yields rose significantly this year, according to Reuters. Recent earnings data from Goldman Sachs showed weakness and declines. Financials and major US commodities fell on the 18th.

The Dow Jones Industrial Average fell 543.34 points, or 1.51%, to 35,368.47, the S&P 500 fell 85.74 points, or 1.84%, to 4,577.11, and the Nasdaq Composite fell 386.86 points, or 7.3%, to 2,946.

The Nasdaq Composite Index, which saw the biggest drop in key indicators, fell 9.7% from its all-time high on Nov. 19 last year. Consumer electronics performed better, up 0.4%.

In the cryptocurrency market, Bitcoin (BTC) fell below $43,000 on the 17th, then fell below $42,000 yesterday to close at $41,250, then rebounded slightly to $42,399 on the trading day. negotiation session, time to write. 0.47%. In the new year, Bitcoin continued to decline, dropping nearly 10% year to date.

Skyrocketing Treasury Yields

As market expectations for inflation from the Federal Reserve rose in March, the yield on the 10-year US Treasury chart rose to 1.888% on the 18th, the highest level since January 2020, and the results of the 2-year Treasury report were also announced. 1%. Rising Treasury yields through 2022 will affect technology and growth and face further depreciation in future financial plans.

Mona Mahazan, chief economist at Edward Jones, said: "Signs of rising inflation are that the economy is in jeopardy and the Fed is taking advantage of the Fed indigestion scare," said said Mona Mahazan, Edward's chief marketing officer. Jones, in an interview with Reuters. growth and development,” he said. A valuable, speculative class.

Investors wonder what the bank should do to rein in inflation next week at the Fed meeting. Data from last week showed that the US consumer price index (CPI) rose 7% year-on-year in December, the biggest annual increase in nearly 39 years.

Damien Mc Colough, director of stable earnings research at Westpac in Sydney, said a 2% increase in US profits over 10 years is almost impossible to conclude, at which point earnings will be slightly slower , but once the US 10-year yield reaches. 2%, Bloomberg reported that the Fed had completed its first rate hike and yields were expected to rise further.

Bloomberg financial analysts expect the 10-year U.S. Treasury yield to hit 2.13% by the end of the year, and futures predict the Fed will raise rates by 25 basis points. 2022.

According to previous data, several Fed officials last week expressed support for the Fed raising interest rates in March to curb inflation. Federal Reserve Chairman Jerome Powell promised on Wednesday that the Fed could complete its difficult task of fiscal tightening, its highest level in 40 years, without hurting the US economy.

Improving politics, hitting the cryptocurrency market

Investment major MorganStanley, in a research note published last week, pointed to lower interest rates, higher-than-expected central bank expansion and government support, according to Coindesk. Market share is the engine of exponential growth.

However, Morgan Stanley noted that the cryptocurrency market has been slowly declining since last year as the Fed and other central banks slowed their balance sheets. , the retail market's sentiment towards social media is still starting to be less optimistic, and the recent price drop has also led to the sentiment.

Morgan Stanley said that since late 2013 Bitcoin's market value has increased due to the rise in the global currency, and Morgan Stanley believes this is no accident.

Although Morgan Stanley concludes that using cryptocurrencies as a payment/exchange platform should be profitable over the long term, the market has invested in most cryptocurrencies as risky securities with Bitcoin over the past few years. last six months. The market proves it.