$Nasdaq Composite Index (.IXIC.US)$ Market concerns over the Federal Reserve's potential further interest rate hikes have intensified. Overnight, the three major US stock indexes opened lower and continued to decline. By the close, the Dow Jones Industrial Average fell by 0.57%, the S&P 500 Index dropped by 0.7%, and the Nasdaq Composite slid more than 1%. Among them, major tech giants fell collectively: Apple dropped 3.6%, Microsoft declined 0.2%, Google fell 1%, Amazon lost 1.4%, NVIDIA slumped 3.1%, and Tesla retreated 1.8%.
The US stock market may face a sell-off this month as September is typically the worst seasonal month for stock returns. Data shows that since 1945, the S&P 500 Index has fallen by an average of 0.7% in September. Yardeni outlined six major risks in a report that could lead to a stock market decline in September.
1. Rising bond yields
Bond yields have been rising recently, with the 10-year US Treasury yield closing above the critical level of 4.25% on Tuesday. Factors driving the rise in yields include surging oil prices and concerns about inflation. If inflation remains high, it could trigger further interest rate hikes by the Federal Reserve.
2. Rising oil prices
On Tuesday, after both Russia and Saudi Arabia announced they would extend their voluntary production cut agreements until the end of this year, oil prices surged significantly. Oil bulls may also believe that oil demand will be further stimulated as China implements economic stimulus measures. These developments have heightened concerns about inflation...