(Reuters) – The New York Stock Exchange opened lower on Wednesday as growing concerns over the expected pace of monetary easing from the U.S. Federal Reserve supported bond yields and put pressure on heavily capitalized technology groups .

In early trading, the Dow Jones index lost 318.93 points, or 0.82%, to 38,533.93 points and the broader Standard & Poor’s 500 fell 0.73% to 38.83 points.

The Nasdaq Composite lost 0.78%, or 133.16 points, to 16,886.72.

The surprise improvement in consumer confidence in the United States in May on Tuesday, as well as comments from Fed Governor Neel Kashkari during an interview, led to a recovery in the bond compartment across the Atlantic.

“Those expectations of a Fed rate cut have been reduced,” said Aneeka Gupta, an analyst at WisdomTree.

“Last night (Minneapolis Fed President) Neel Kashkari mentioned that we still can’t rule out a rate hike in 2024,” he added.

The ten-year US Treasury yield thus reached a level not seen since May 3 on Wednesday, at 4.578%, as did the CBOE VIX volatility index, an indicator of concerns on Wall Street.

In terms of values, technology groups with high capitalization such as Apple, Meta and Nvidia lost between 1.3% and 0.55% against a backdrop of tensions in the bond market.

American Airlines plunges 13% after the group on Tuesday reduced its profit forecast for the current quarter, Jefferies having also lowered its recommendation on the stock to “hold” from “buy”.

Conocophillips lost 2.5% and Marathon Oil rose 9.4%, with the Financial Times reporting on Wednesday that the two groups are in advanced discussions as part of a proposed all-stock acquisition of the latter by the former for a enterprise value of $15 billion.

(Written by Augustin Turpin, edited by Blandine Hénault)

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