Wall Street Ends Lower as Apple Falls, Bond Yields Rise

NDTV Profit Desk

10 Sep 2014, 07:31 AM IST

US stocks fell on Tuesday as Apple shares declined and as bond yields hit their highest in a month on concerns the Federal Reserve could raise interest rates sooner than some investors had expected.

All 10 S&P 500 sectors ended lower. Apple shares, which jumped as much as 4.8 per cent earlier in the session after the company unveiled a smartwatch, ended down 0.4 per cent at $97.99. Apple also announced two larger iPhones.

Benchmark 10-year US Treasury note yields rose to 2.5 per cent. Sectors with high-dividend paying stocks including utilities were among the day's weakest. The utilities sector and telecommunications each fell 1.2 per cent.

Improving US economic conditions may force the Federal Reserve "to tighten sooner rather than later," said Doug Cote, chief market strategist with Voya Investment Management in New York.

"Rising rates are an immediate discount for financial assets, including equities," he said.

Shares of Home Depot fell 2.1 per cent, a day after the company confirmed its payment security system had been breached.

The Dow Jones industrial average declined 97.55 points or 0.57 per cent, to 17,013.87, the S&P 500 lost 13.1 points or 0.65 per cent, to 1,988.44 and the Nasdaq Composite dropped 40.00 points or 0.87 per cent, to 4,552.29.

About 5.7 billion shares changed hands on US exchanges, above the 5.5 billion average for the last five days, according to data from BATS Global Markets.

In the options market, Apple options volume rose to a record daily volume of 2.97 million contracts traded, according to Henry Schwartz, president of options analytics firm Trade Alert. Contract volume was about three times normal and calls led puts by a ratio of 2.1:1, according to Trade Alert data.

The largest percentage gainer on the New York Stock Exchange was Pulse Electronics, which was rising 53.47 per cent, while the largest percentage decliner was Usec, down 18.05 percent.

Among the most active stocks on the NYSE were Brazil's Petrobras, down 2.83 per cent to $17.83 and Pfizer, down 0.58 per cent at $29.23.

Besides Apple, Yahoo, down 2.5 per cent at $40.78, and Microsoft, up 0.6 per cent to $46.76 were among the most actively traded on Nasdaq.

Declining issues were outnumbering advancing ones on the NYSE by 2,338 to 698, for a 3.35-to-1 ratio on the downside; on the Nasdaq, 2,046 issues were falling and 637 advancing for a 3.21-to-1 ratio favoring decliners.

The broad S&P 500 index was posting 17 new 52-week highs and five new lows; the Nasdaq Composite was recording 56 new highs and 58 new lows.