Treasury revenue has yielded

This report is from today’s CNBC Daily Open, our international market newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. As you see? You can subscribe here.

Yields continue to weigh on stocks
US stocks fell on Wednesday as Treasury yields continued to rise. regional Europe Stoxx 600 index down 0.3%. Separately, policymakers at the European Central Bank disagreed on whether to lower rates by half a percent at their December meeting.

Tesla beat earnings forecasts
Tesla shares jumped 12% in extended trade after the company’s third-quarter earnings beat Wall Street estimates. However, Tesla’s revenue for the period, up 8% year over year, missed expectations.

IBM’s revenue fell short of expectations
IBM’s third quarter revenue missed expectations. For the period, the top line rose 1.5% year-on-year, largely driven by consensus earnings of $6.52 billion from IBM’s software segment. IBM expects overall revenue to expand by roughly the same amount for the fourth quarter. The stock was down about 3% in extended trade.

‘Time to be a little more careful’
Bank Norges Investment Management, which manages Norway’s sovereign wealth fund, said current geopolitics and stock markets warrant a cautious approach. “It’s time to be a little more cautious, and I think the risk is more down in the equity market than up,” Trond Grande, deputy CEO of NBIM, told CNBC Tuesday.

(PRO) 6,600 Target for S&P in 2025?
At S&P 500 is on the tear in 2024. There are some headwinds that could dampen the rally before the end of the year, he said Piper Sandler chief market technician. But he thinks the S&P could rise further and reach the 6,600 level next year, about 13.8% higher than the S&P’s closing level on Wednesday.

Like former unpopular partners who appeared at the most inopportune times and refused to leave, Treasury yields have also been at the center of market attention.

Yields have been rising over the past month with Treasury 10 years yield gained approximately four basis points to 4.25% on Friday. During the US trading session, the 10-year yield touched 4.26%, the highest level since July 26.

This comes despite the US Federal Reserve cutting interest rates by 50 basis points at its September meeting and indicating it will lower rates by the same amount by the end of the year.

It seems that the market has oscillated from worries about weakness in the US to worries that the US economy is too strong.

The Fed’s “Beige Book” records positive notes on the economy. Most regions in the US “reported low worker turnover, and layoffs reportedly remained limited,” the report said, while “contacts were more optimistic about the long-term outlook.”

So, it’s not inconceivable that a strong economy could lead the Fed to slow down, or even hold off on, rate cuts.

“For me, it’s all about the impact of higher rates. The market is repricing the possibility that the Fed can aggressively cut rates,” said Brent Schutte, chief investment officer at Northwestern Mutual Wealth Management.

The stock market fell as a result of the rebound. At S&P 500 back 0.92%, in Dow Jones Industrial Average lost 0.96% – the worst day in more than a month – and so on Nasdaq Composite down 1.6%.

But Paul Hickey, founder of Bespoke Investing Group, says investors should not panic. “It’s a tough day, but today is what happened,” Hickey told CNBC. And Wells Fargo thinks the stock could rally in 2025 despite the uncertainty.

While rising Treasury yields appear to have halted the stock rally, like an unwelcome guest, they are likely to retreat in time and the market should continue its upward move if earnings remain strong.

– CNBC’s Jeff Cox, Lisa Kailai Han, Pia Singh and Brian Evans contributed to this report.