Traders work on the floor of the New York Stock Exchange during morning trading on September 16, 2026 in New York City.
Michael M. Santiago | Getty Images
The S&P 500 fell on Friday as traders wrapped up a volatile week in which traders navigated another rise in Treasury yields and oil prices along with the Federal Reserve’s first rate hike in three years.
The broad market index dropped 0.2%, while the Nasdaq Composite traded down 0.1%. The Dow Jones Industrial Average shed 195 points, or 0.4%.
Treasury yields increased, weighing on equities. The 10-year yield, which climbed above 5% to hit its highest level since July 2007 earlier in the week, rose back above that level after sliding Thursday. It was last up more than 5 basis points at 5.00%.
U.S. crude oil was little changed, with West Texas Intermediate crude futures falling about 1% but still trading above $100 a barrel. Global benchmark Brent crude futures were marginally lower as well and traded around $104 a barrel.
With Friday’s moves, the major stock averages are on pace for a mixed week. The Dow is down by 2% this week, on track for a third straight losing week. The S&P 500 was also lower week-to-date by 0.5%. Only the tech-heavy Nasdaq is set to post weekly gains, up 0.3%.
U.S. markets staged a comeback on Thursday after the Fed’s decision to raise rates by a quarter percentage point — with the suggestion of at least one more rate increase this year — drove major market averages lower Wednesday.
But Thursday’s rally, especially in technology stocks, suggests investors are eager to look past the prospect of a higher-for-longer rate environment, returning instead to an artificial intelligence story that should continue to bolster corporate profits.
“Some uncertainty was removed this week when the when the Fed hiked rates,” said Scott Welch, chief investment officer at Certuity.
But Welch doesn’t think that the latest hike was a one-and-done move. In fact, he believes a rate hike cycle is just beginning and could dampen equity performance over the coming months.
“At some point, whether it’s October or after the elections, I think the Fed will hike at least one more time in 2026 and probably another time or two in 2027,” he said.
With that in mind, Welch forecasts that the pressure on Treasury yields will continue to be up. He also anticipates that oil prices will remain elevated for the next few months.
“While I’m not bearish on the market, I do think we’re kind of in a chug-along environment for the rest of this year,” the investment chief added.
