Timothy A. Clary/Getty Images
- US stocks dropped Friday as the 10-year Treasury yield pulled back but remained close to 5%.
- Cleveland Fed President said the central bank is close to the end of its rate-hiking cycle.
- Markets continued to monitor rising geopolitical tension in the Middle East, with Brent trading above $92.
US stocks dropped to end the week, with the Nasdaq losing more than 1.5% in Friday's trading session as the 10-year Treasury yield edged lower but remained close to the highest levels since 2007.
The Dow Jones Industrial Average lost nearly 300 points, while the S&P 500 dropped more than 1%.
The 10-year Treasury dipped by about seven basis points to 4.912%, only down slightly from a day earlier when the benchmark bond yield touched 5% for the first time since 2007.
Oil prices pared gains from earlier in the day, but international crude ended above $92 a barrel as energy traders monitored the conflict between Israel and Hamas. Reports have pointed to the likelihood of an Israeli ground assault as troops build at the Gaza border, and markets are watching for signs the conflict could spread to other parts of the region.
Traders were also digesting fresh comments from a top Federal Reserve official. In an event organized by the Manhattan Institute on Friday, Cleveland Fed President Loretta Mester said the end of the bank's rate-hiking cycle is near.
"Regardless of the decision made at our next meeting, if the economy evolves as anticipated, in my view, we are likely near or at a holding point on the funds rate," she said.
She also signaled that she's still in the camp favoring one more rate hike before the end of the year.
"It is important to guard against becoming complacent if it takes longer and longer to achieve the Fed's 2% goal," Mester said.
A day earlier, Fed chair Jerome Powell hinted that rates could stay unchanged at the November meeting, but that doesn't mean future hikes are out of the question.
Here's where US indexes stood as the market closed at 4:00 p.m. on Friday:
- S&P 500: 4,224.16, down 1.26%
- Dow Jones Industrial Average: 33,127.28, down 0.86% (-286.89 points)
- Nasdaq Composite: 12,983.81, down 1.53%
Here's what else is going on:
- The Dow's transportation index is ringing alarm bells about the broader market.
- Morgan Stanley said home prices could drop 5% next year if mortgage rates stay at two-decade highs.
- The stock market's volatility indicator is signaling a trough in the S&P 500.
- "Big Short" investor Steve Eisman said he's buying stocks rooted in the "old economy."
- China signed yuan-denominated loans for the Belt and Road initiative.
- Here's why Poland's zloty has jumped to the top spot against the dollar.
- Bank of America said another stock market buy signal is flashing.
- China stocks have wiped out all of their gains since the country reopened from pandemic lockdowns.
- Billionaire investor Leon Cooperman said the S&P 500 won't hit new highs for years.
- Elon Musk's fortune plunged by $16 billion in a single day, but he could lose a lot more and still be the richest person in the world.
In commodities, bonds, and crypto:
- Oil prices slipped, with West Texas Intermediate down 0.39% to $89.02 a barrel. Brent crude, the international benchmark, moved lower 0.14% to $92.25 a barrel.
- Gold edged higher 0.57% to $1,991.90 per ounce.
- The 10-year yield moved lower seven basis points to 4.912%.
- Bitcoin climbed 2.70% to $29,521.