The sell-off in tech large caps weighed heavily on stocks, with the Nasdaq 100 underperforming and the S&P 500 just about 2.5 percent off its June bottom. Ten-year US yields hovered near 3.7%, the highest since February 2011, while the two-year rate topped 4.1%. Traders also weighed in on a news story that said Credit Suisse Group AG is discussing a possible exit from the US market. The dollar remained at an all-time high. Fueled by hawkish Fed policy and investors seeking a safe haven from market falls, the dollar has climbed against bonds by the most in decades. The move prompted Japan to prop up the currency for the first time since 1998. The Swiss franc posted its biggest drop since 2015 against the euro after the central bank’s hike proved insufficient to meet traders’ expectations. The Fed gave its clearest signal yet that it is willing to tolerate a slowdown as a necessary trade-off to regain control of inflation, with officials signaling a further tightening of 1.25 percentage points before the end of the year. Norway, Britain and South Africa also followed with hikes of their own as officials scramble to deal with runaway price hikes. “We see this new rate path, even higher for longer, associated with a significantly higher probability of a hard landing and therefore not just clearly aggressive but clearly risk-averse,” said Krishna Guha, vice president of Evercore ISI. The S&P 500 could be poised for more declines after breaking through a rare technical indicator, according to Berenberg strategists, including Jonathan Stubbs. It has traded below its 200-day moving average for more than 100 sessions — a streak previously broken only during the tech bubble and global financial crisis of the past 30 years. In both of those cases, the index posted most of its losses after breaking through that level, with the index falling a further 50 percent in 2000-2003 and 40 percent in 2008-2009 before falling, they said. Evercore’s chief equity and quantitative strategist Julian Emanuel cut his year-end forecast for the S&P 500 to 3,975 from 4,200 and expects a “full review” of the June low in the coming weeks. The reduction in the target is due to a growing possibility of a recession after Fed Chairman Jerome Powell warned that the process of raising interest rates will not be “painless” for the labor and housing markets. “The bad news is that we’re still in one of the weakest seasonal windows of the year, especially in a mid-term year,” said Jonathan Krinsky, chief market technician at BTIG. “The good news is that it quickly reverses by mid-October. We believe we will test or break the June lows before then, which will create a better entry point for a year-end rally.” Dennis DeBusschere at 22V Research expects markets to remain volatile as he maintained his neutral stance on the stock. “It’s hard to wait until we get signs of slower underlying demand growth, but tail risk is limited by already tighter economic conditions, lower PEs and higher implied volume,” he wrote. In today’s context, Mark Haefele at UBS Global Wealth Management says the environment is not conducive to strong directional positioning in global indices. However, he advises against retreating to the margin, “especially given the pull of cash from high inflation and the challenge of timing the return to markets without missing rebounds.” “Instead, we remain invested but selective and focus our preferences on defense, income, value, diversification and security,” he added. Here are some of the main moves in the markets: inventories

The S&P 500 was down 0.7% at 11:34 a.m. New York time The Nasdaq 100 fell 1.2%. The Dow Jones Industrial Average fell 0.3%. The Stoxx Europe 600 fell 1.8%. The MSCI World index fell 1 percent

currency

The Bloomberg Dollar Spot Index rose 0.1%. The euro fell 0.1 percent to US$0.9826 The British pound was little changed at US$1.1260 The Japanese yen rose 1.3% to 142.16 yen per dollar

Bindings

The yield on the 10-year note rose 16 basis points to 3.69 percent Germany’s 10-year yield rose eight basis points to 1.98%. Britain’s 10-year yield rose 19 basis points to 3.50 percent

Goods

West Texas Intermediate crude rose 1.3% to US$84 a barrel Gold futures rose 0.3% to $1,680.30 an ounce