Mixed Markets in Asia-Pacific, Yields Rise, Geopolitical Tension Remains High

On Tuesday, the stock markets in the Asia-Pacific region ended the day mixed, with the Hong Kong and New Zealand markets leading the slide.[0] Due to the absence of signals from Wall Street, which was closed on Monday for the holiday, traders in the region were unsure of how to proceed.[0] In contrast, the Chinese and Malaysian markets saw moderate growth.[0] The markets of South Korea and Taiwan saw slight increases.[0]

Shares of Home Depot (NYSE:HD) plummeted over 7% after the company’s fourth-quarter results came in under expectations, and their 2023 earnings per share projection was a mid-single-digit percentage decline, contrary to analysts’ predictions of flat earnings.[1]

The 10-year Treasury yield, which impacts the rates of mortgages and other important loans, rose to 3.95% on Monday, up from 3.82% on Friday. The two-year yield increased to 4.73% from 4.62%, a movement that is more dependent on perceptions of the Federal Reserve.[2] Its value is near its peak since 2007.[2] The S&P 500 decreased by 1.8%, the Dow Jones Industrial Average decreased by 1.9%, which was equivalent to 638 points, and the Nasdaq Composite dropped by 2.2%.[3]

Vladimir Putin, President of Russia, declared that the nation would suspend its adherence to the New START nuclear arms treaty with the United States, which Secretary of State Antony Blinken described as “irresponsible.”. In a speech marking the one-year anniversary of Putin’s invasion of Ukraine, President Joe Biden declared that the Russian leader would never triumph in his war.[4]

Shares of DocuSign (NASDAQ:DOCU) tumbled by nearly 8% after UBS decreased its rating on the company to Sell from Neutral due to worries about the stock’s valuation following its recovery from December lows.[5]

Joe Biden’s visit to Europe and his promise of further backing for Ukraine have caused geopolitical tensions to remain high.[6] On Tuesday, President Vladimir Putin of Russia announced the suspension of Russia’s involvement in the New START Treaty, which sets limits on the quantity of strategic nuclear warheads that can be deployed.

The yield of the 2-year Treasury note TMUBMUSD02Y increased 10.8 basis points to 4.729%, the highest level of the U.S. session since July 24, 2007.[1] The yield of the 10-year Treasury Note (TMUBM[1]

0. “Nasdaq, S&P 500 Futures Slump As Traders Weigh-In Retail Earnings, Uncertain Economic Backdrop – Invesco” Benzinga, 21 Feb. 2023, https://www.benzinga.com/news/earnings/23/02/30981796/nasdaq-s-p-500-futures-slump-as-traders-weigh-in-retail-earnings-uncertain-economic-backdrop

1. “Stock market books worst day of 2023 as rising yields contribute to ‘perfect storm’” MarketWatch, 22 Feb. 2023, https://www.marketwatch.com/story/why-is-the-stock-market-falling-blame-a-perfect-storm-as-yields-rise-dollar-rallies-ec23b387

2. “Wall Street Tumbles, Dow Loses 697 on Rate Fears” Newsmax, 21 Feb. 2023, https://www.newsmax.com/finance/streettalk/financial-markets/2023/02/21/id/1109574/

3. “Stock market today: Dow tumbles as rout in retailers, tech wreck weigh By Investing.com” Investing.com, 21 Feb. 2023, https://www.investing.com/news/stock-market-news/stock-market-today-dow-tumbles-as-rout-in-retailers-tech-wreck-weigh-3009545

4. “Wall Street’s angst over Fed hits stocks and bonds” Crain’s New York Business, 21 Feb. 2023, https://www.crainsnewyork.com/finance/wall-streets-angst-over-fed-hits-stocks-and-bonds

5. “Stocks Sink As 10-Year T-Note Yield Rises To 3-1/4 Month High” Barchart, 21 Feb. 2023, https://www.barchart.com/story/news/14410202/stocks-sink-as-10-year-t-note-yield-rises-to-3-1-4-month-high

6. “Stocks and bonds fall amid higher-for-longer rate concerns” UBS, 22 Feb. 2023, https://www.ubs.com/global/en/wealth-management/our-approach/marketnews/article.1583100.html