Investors watched the major market averages open up to the downside as Tuesday’s rally was short lived. At the start of Wednesday’s trading session, the Dow (DJI) is lower by 1.1%, the S&P (SP500) slipped 1.2%, and the Nasdaq (COMP.IND) has dropped 1%.
Cooling off alongside the benchmark indices are bond yields. The U.S. 10-Year Treasury yield has declined 14 basis points to 3.15% and the U.S.2-Year Treasury yield has come down by 11 basis points to 3.08%.
Commodity prices have also subsided with oil retreating roughly 6.5% and heading close to $100 a barrel. Crude has now fallen below its 100-day moving average.
Other commodities trading in the red include natural gas, silver, platinum, copper, steel, coal, and soybeans.
From a global market stance, inflation figures rose in the United Kingdom and Canada. In the U.K. CPI data came in at 9.1% Y/Y notching the countries highest inflation levels in 40 years. Canadian annual inflation increased to 7.7% Y/Y its highest point in 39 years.
Investors will look to watch Fed Chair Powell speak at 9:30 to see if he tips his cap towards future Fed decisions in Wednesday’s semiannual monetary policy report to congress which kicks off at 9:30 am E.T.
Societe Generale stated in a note put out on Wednesday: “A US recession looks imminent and the discussion in the markets has moved on to how deep it will be. Forecasts for a ‘mild’ recession will now abound. But when a key Fed economic model sees an 80% chance of a hard landing, you know things are bad!”