Wall Street opens down, the yield curve is scary

PARIS (Reuters) – Wall Street opened Wednesday down with investors worried about the evolution of bond yields, which wakes in them the fears of an entry of the US economy into recession.

The Dow Jones index lost 98.11 points, or 0.38%, to 25,679.79 points and Standard & Poor's 500, wider, down 0.38% to 2,858.22 points a few minutes after opening.

The Nasdaq Composite yields 0.33% to 7.801,39 points.

The yield spread between yields of US government bonds at 2 and 10 years increased Wednesday to -6 basis points, unheard since 2007, before narrowing slightly.

The fact that short rates pass above long rates characterizes the inversion of the yield curve, a phenomenon historically considered as the signal of an entry into recession in the more or less short term.

The bond market reflects fears surrounding the impact of trade tensions on the US economy and corporate earnings, which are leading investors to massively anticipate a further rate cut by the Federal Reserve next month.

In terms of values, Autodesk dropped 13% in early trade after lowering its annual profit forecast.

(Markets Service)