Tech Stocks Rally and Bank Shares Plunge on Jackson Hole Effect... NY Market Ends Mixed

[Image source=Reuters Yonhap News]

[Asia Economy New York=Correspondent Baek Jong-min] U.S. technology stocks showed strong gains as Jerome Powell, Chairman of the U.S. Federal Reserve (Fed), expressed his intention not to rush interest rate hikes.

On the 30th (local time), the Dow Jones Industrial Average closed down 55.96 points (0.16%) at 35,399.84. In contrast, the S&P 500 index rose 19.42 points (0.43%) to 4,528.79, and the Nasdaq index gained 136.39 points (0.90%) to close at 15,265.89.

Following Powell's speech at Jackson Hole, U.S. Treasury yields, which had been declining, fell further on the day, triggering a rally in technology stocks.

The 10-year U.S. Treasury yield recorded 1.28%, down 0.03 percentage points from the previous trading day. The 10-year yield had risen to the high 1.3% range last week ahead of the Jackson Hole meeting but showed weakness for two consecutive days after Powell's remarks. A decline in Treasury yields means an increase in bond prices.

Apple, the leading stock, showed a notable rise. Apple's stock price surged 3.04% on the day, pushing its market capitalization past $2.5 trillion (approximately 2,912.5 trillion KRW). This marks just over a year since it first joined the $2 trillion market cap club in August last year as a U.S. company.

It is analyzed that this was influenced by reports that Apple will equip the upcoming iPhone 13, to be unveiled next month, with satellite communication capabilities.

The stock price of Globalstar, a low Earth orbit (LEO) satellite company expected to collaborate with Apple, also soared vertically by 64%.

Robinhood fell 6.89% due to comments by Gary Gensler, Chairman of the Securities and Exchange Commission (SEC), that the sale of customer stock trading order flow, a major source of revenue, could be banned.

Some sectors suffered due to the decline in interest rates. On the day, stocks of financial companies such as Wells Fargo, JP Morgan, and Capital One all plunged sharply, as falling interest rates could lead to reduced profits.

Airline stocks also took a hit. United, Delta, and American Airlines stocks dropped by over 3%. This is attributed to the European Commission's recommendation to 27 member countries to ban non-essential travel entry by Americans.