US STOCKS SNAPSHOT-Futures cut back losses as benchmark Treasury yield drops

BY Reuters | TREASURY | 09/28/22 06:49 AM EDT

Sept 28 (Reuters) - U.S. stock index futures sharply pared losses on Wednesday and the Dow as well as S&P 500 e-minis briefly turned positive after the benchmark U.S. Treasury yield pulled back from a 12-year high.

The 10-year Treasury yield fell to 3.896%, helping ease the selling pressure on rate-sensitive growth stocks.

Futures also took relief from a Bank of England decision to buy as many long-dated government bonds as needed between now and Oct. 14 to stabilize financial markets.

At 6:34 a.m. ET, Dow e-minis were down 55 points, or 0.19%, S&P 500 e-minis were down 13.75 points, or 0.38%, and Nasdaq 100 e-minis were down 87.25 points, or 0.77%.

The Dow e-minis were briefly up 66 points, or 0.23% and S&P 500 e-minis added 3 points, or 0.08%, while Nasdaq 100 e-minis were down 27.75 points, or 0.24%. (Reporting by Shreyashi Sanyal in Bengaluru; Editing by Arun Koyyur)

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.) Fixed income securities also carry inflation risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Lower-quality debt securities generally offer higher yields, but also involve greater risk of default or price changes due to potential changes in the credit quality of the issuer. Any fixed income security sold or redeemed prior to maturity may be subject to loss.

Before investing, consider the funds' investment objectives, risks, charges, and expenses. Contact Fidelity for a prospectus or, if available, a summary prospectus containing this information. Read it carefully.