Foreign Currency

Stocks mixed at Tuesday open, US dollar rallies


The Dow Jones Industrial Average (^DJI) is pushing higher at Tuesday’s market open, while the S&P 500 (^GSPC) hovers around its flatline and the Nasdaq Composite (^IXIC) dips lower.

Morning Brief Co-Hosts Seana Smith and Brad Smith monitor the stock market indexes after the opening bell while Senior Markets Reporter Jared Blikre examines the US dollar’s position in foreign currency exchanges.

For more expert insight and the latest market action, click here to watch this full episode of Morning Brief.

This post was written by Luke Carberry Mogan.

Video transcript

SEANA SMITH: We are looking at a bit of a mixed picture. You’ve got the Dow at least opening to the upside, up just around 200 points. Taking a look at the S&P coming off its worst two-day slide that we’ve seen in just over a year, that’s actually moving just above the flat line. The Nasdaq though, we’re seeing some move to the downside here, off just about a 10th of a percent. And taking a look also at the action that we’re seeing play out in the bond market, we’ve got yields pushing higher once again, up up 3 basis points to 4.66. Brad, getting closer and closer to that 5% level. We’ll see.

BRAD SMITH: Yeah, indeed. We’ve got standing by at the jumbotron our own Jared Blikre looking at currencies. You know what, Jared? We were going to workshop it, but we’re just going to call it the Yahoo Finance Jumbotron now.

JARED BLIKRE: Yeah, that works for me because it is rather large.

[MUSIC PLAYING]

Let’s put that behind me. I want to show you– You left off on the 10-year. I think that’s a great place to start here, the bond market, because we’ve seen yields screaming higher. I’m just going to quickly pull up. Here we go. Here’s a two-month chart. Now this is from the lower left to the upper right here, highest levels of the year, and this weighs on a lot of asset classes, international stocks, it weighs on commodities, it weighs on crypto.

And after that, I want to focus on the US dollar because, as we see higher rates, well, that attracts capital from around the world. People rush into the US dollar to buy our bonds, and then that drives the US dollar up, so we’re also seeing the US dollar. Now it is– let me put some candlesticks so you can see the trend a little bit better. That’s what? About five days there of up swings here.

But for the 10-year, it actually broke up before. So the dollar is a little bit lagging here. That’s pretty typical. And I just want to show you a couple of currencies in relation to the US dollar, because I think this is really instructive about where we are in the international game. And first and foremost is the yen. Got to talk about that. I’m going to throw it up.

So, by the way, all of these green squares these are various currencies around the world. That means the US dollar is strengthening relative to them. Now not strengthening versus a British pound and the euro. So those are blocking the trend, but let me show you the year-to-date trends here.

You can see the Turkish lira in the upper left. Well, the Japanese yen is neck and neck with the lira, which is one of the worst-performing currencies on Earth. And the Bank of Japan, bottom line, may be forced to act here. So sometimes when currency dislocations happen, things get out of whack. It’s a game of catch-up, and you don’t want to see the Bank of Japan in that position.

BRAD SMITH: All right. Jared, thanks so much. Of course, major moves on the currency side that we’re going to continue to track. Thanks so much for teeing that up.



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