---
title: "Stocks decline as growth, rate worries persist: markets wrap"
description: "US stocks fell as concern over an economic slowdown and prospects for higher interest rates weighed on risk sentiment. Treasuries declined, sending yields higher across the curve."
type: "NewsArticle"
publisher: "Daily Maverick"
site: "https://www.dailymaverick.co.za"
section: "International Finance"
author: "Bloomberg"
author_url: "https://www.dailymaverick.co.za/author/bloomberg/"
canonical_url: "https://www.dailymaverick.co.za/article/2023-01-19-stocks-decline-as-growth-rate-worries-persist-markets-wrap/"
published: "2023-01-19T18:22:01"
lang: "en-ZA"
word_count: 351
---

# Stocks decline as growth, rate worries persist: markets wrap

> US stocks fell as concern over an economic slowdown and prospects for higher interest rates weighed on risk sentiment. Treasuries declined, sending yields higher across the curve.

By Bloomberg · Published 19 January 2023, 20:22 SAST

## Content

The S&P 500 Index dropped for a third day, testing the 3,900 level after the benchmark’s biggest selloff in a month on Wednesday. The tech-heavy Nasdaq 100 fell as much as 1.1%. Treasuries retreated with the 10-year yield up 3 basis points, and the euro traded firmer after the head of the European Central Bank reaffirmed her aggressive stance.

On the earnings front, Procter & Gamble Co slid after reporting shrinking sales volume. Alcoa fell after saying aluminum shipments will be weaker than anticipated this year. Discover Financial Services sank after the credit-card company warned write-off rates may double this year.

A rally driven by optimism over China’s economic reopening has fizzled as recent data signal a slowdown. Reports from the US this week showed declines in consumer demand and business investment, boosting the probability of a recession in the world’s largest economy. That, however, didn’t deter Federal Reserve officials from reaffirming the need for tighter monetary policy.

Data was mixed on Thursday, with new US home construction declining for a fourth-straight month in December. Applications for US unemployment benefits unexpectedly fell last week, sliding to the lowest level since September and underscoring a strong jobs market.

In the US on Wednesday, releases showed producer prices and retail sales fell, while business equipment production slumped. A decline in factory output wrapped up the weakest quarter for manufacturing since the onset of the pandemic. Prominent Fed hawks on Wednesday repeated calls for higher rates.

“Wage growth has slowed, and broad data is weakening, but Fed officials (at least the ones that have spoken so far) are clearly reluctant to let financial conditions ease,” writes Dennis DeBusschere, of 22V Research. “The hyper focus on anchoring financial conditions will change as inflation continues to move lower/data weakens, but there are not enough data points for the Fed to be comfortable with that call yet.”

On Thursday, Boston Fed president Susan Collins, who does not vote on policy this year, said she favors a more moderate pace of interest-rate increases. Fed governor Lael Brainard, a voting member, is scheduled to speak later on Thursday. **BM/DM**