The Dow Jones Industrial Average and other major indexes fell sharply on Wednesday afternoon as the yield on the 10-year U.S. Treasury note continued its upward trajectory, reaching 4.23% – a level not seen since July.
In the afternoon, the Dow Jones fell 631 points, or 1.4%, on course for its worst day in more than a month. Meanwhile, the tech-heavy Nasdaq and S&P 500 fell 2.2% and 1.4%, respectively. However, there was some relief for investors as oil prices fell, with West Texas Intermediate (WTI) futures trading around $70.65 per barrel.
The Federal Reserve’s Beige Book, released in the afternoon, reported that economic activity remained largely unchanged across the 12 Federal Reserve districts, with the Southeast significantly affected by a severe storm season.
All eyes will be on Tesla (TSLA) on Wednesday as the company prepares to release its latest earnings report. Analysts expect earnings per share to be 60 cents, down from 66 cents a year ago but an improvement from 52 cents in the previous quarter, according to FactSet estimates. Revenue is expected to reach $25.4 billion, compared to $23.3 billion in the third quarter of 2023 and $25.5 billion in the previous quarter.
In addition to Tesla, investors are closely watching the earnings reports of other major companies, including AT&T (T), Boeing (BA) and Coca-Cola (KO).
McDonald’s shares plummet more than 5%
Shares of McDonald’s (MCD) took a sharp hit, falling more than 5% after the Centers for Disease Control and Prevention (CDC) linked the chain’s Quarter Pounder burgers to an E. coli outbreak. The outbreak has led to 10 hospitalizations and one death, sending McDonald’s shares down significantly during the afternoon trading session.
So far, 49 cases have been reported in 10 states between September 27 and October 11, with the most illnesses occurring in Colorado, Nebraska, Utah and Wyoming. The CDC noted that most of those affected had eaten a Quarter Pounder. Investigators are working quickly to identify the contaminated ingredient.
Spirit Airlines shares rise 30%
After a failed attempt at a merger with JetBlue (JBLU-0.80%), ultra-low-cost carrier Spirit Airlines (SAVE+28.01%) is reportedly returning to a high-profile partner. The Wall Street Journal (NWSA-0.34%), citing people familiar with the matter, reports that Spirit and Frontier Airlines (ULCC+3.05%) are in early discussions about a possible merger. The news sent Spirit’s shares soaring nearly 30% on Wednesday.
–Francisco Velasquez and Rocio Fabbro contributed to the article
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