Stock Market today: Dow slides, geopolitical tensions, spike in Treasury yields

Dow drops as Treasury yields spike, retail sales beat expectations. Goldman Sachs shines, Apple falls, Tesla faces layoffs. Geopolitical tensions rise.

The Dow Jones Industrial Average experienced a significant decline on Monday, largely due to a spike in Treasury yields and escalating geopolitical tensions. This increase in yields, coupled with stronger-than-expected retail sales data, led to a decrease in expectations for interest rate cuts and overshadowed positive earnings reports from companies like Goldman Sachs.

At 16:00 ET (20:00 GMT), the Dow Jones Industrial Average dropped by 248 points, representing a 0.7% decrease, while the S&P 500 and NASDAQ Composite also experienced declines of 1.2% and 1.8%, respectively. The surge in Treasury yields following the unexpected growth in retail sales last month indicated a strong consumer market, which in turn reduced the likelihood of rate cuts by the Federal Reserve this year.

The 10-Year Treasury yield saw an 11 basis points increase to 4.61%, reflecting the positive retail sales data that exceeded economists' expectations. This data, particularly the rise in the retail sales control group, which has a significant impact on U.S. GDP, led some economists to revise their forecasts for Q1 economic growth and suggest that rate cuts may not be imminent.

While companies like Goldman Sachs and Charles Schwab reported positive earnings, with Goldman Sachs seeing a significant increase in Q1 profit and Charles Schwab surpassing Wall Street estimates, tech giants like Apple and Tesla experienced declines in stock prices. Apple lost its position as the world's top phone maker to Samsung, leading to a 2% drop in its stock, while Tesla saw a more than 5% decrease amid reports of potential layoffs due to declining sales.

Additionally, Reddit Inc faced a more than 5% decline after several Wall Street firms initiated coverage on the stock, with mixed ratings from different analysts. Geopolitical tensions also played a role in market volatility, as reports of potential conflict between Israel and Iran raised concerns about wider regional instability, prompting investors to seek safe-haven assets like gold.

Overall, the market fluctuations on Monday were driven by a combination of factors, including Treasury yield increases, retail sales data, earnings reports, and geopolitical tensions. These elements contributed to a complex and dynamic trading day that highlighted the interconnected nature of global financial markets.