US Equity Indexes Fall as Sinking Treasury Yields, Surging Gold Hit Risk Sentiment

02:13 PM EDT, 10/16/2025 (MT Newswires) -- US equity indexes fell after midday on Thursday as a sharp drop in government bond yields and a surge in gold and silver futures to new all-time highs undermined investor confidence.

The Nasdaq Composite fell 0.3% to 22,596.5, with the S&P 500 down 0.5% to 6,637.6 and the Dow Jones Industrial Average 0.4% lower at 46,062.9. Financials and energy led the decliners intraday. Technology was among the trio of gainers.

Zions Bancorporation (ZION) said it will take a $50 million charge-off in Q3 tied to two commercial and industrial loans from its California unit after identifying "apparent misrepresentations and contractual defaults." Its shares slumped nearly 11% intraday. The disclosure added to investor unease about credit stress as lenders navigate high interest rates and economic uncertainty, Reuters reported. The SPDR S&P Regional Banking ETF (KRE) slumped 5% intraday.

The CBOE Volatility Index, also known as the fear gauge, soared 13% to 23.27.

Meanwhile, Treasury Secretary Scott Bessent on Wednesday said the ongoing government shutdown, which began on Oct. 1, could be costing the US economy up to $15 billion a week, FOX Business reported. That translates to a hit to gross domestic product of about 0.2 percentage points a week, according to a BBC news report. Senate votes on continuing resolutions or funding bills have repeatedly failed, making the political impasse one of the longest in the history of the US.

Gold futures were up 2.5% to $4,307.50 after touching yet another all-time high of $4,311.80, and silver futures traded 3.8% higher at $53.38 after hitting a new peak of $53.615 earlier in the session.

The ICE US Dollar Index dropped 0.5% to 98.34.

West Texas Intermediate crude oil futures dropped 1.3% to $57.52 a barrel.

On the monetary policy front, Federal Reserve Governor Christopher Waller said Thursday at the Council on Foreign Relations that the Federal Open Market Committee should proceed with care while continuing to ease monetary policy based on current data.

"Based on what I know today, I support continued easing of monetary policy from its current setting, which I judge is moderately restricting aggregate demand and economic activity," Waller said. "But I also see a conflict right now between data showing solid growth in economic activity and data showing a softening labor market."

On Wednesday, Fed Governor Stephen Miran advocated for an additional 1.25 percentage points in rate cuts, on top of the quarter-point reduction in September, arguing that current policy is "quite restrictive" and leaves the economy vulnerable to shocks, CNBC reported.

US Treasury yields fell, with the two-year yield down 7.1 basis points to 3.44% and the 10-year rate 6.5 basis points lower at 3.98%.

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