US stocks dropped on Wednesday, pressured by rising US Treasury bond yields and significant losses in McDonald’s and Starbucks following negative developments.
Market analysts pointed to rising uncertainty surrounding the continued climb in US Treasury yields. There remains a lack of clarity on whether the increase reflects optimism about economic growth or concerns over inflation and the growing US budget deficit.
By mid-morning, the Dow Jones Industrial Average fell by 0.5%, reaching 42,711.30 points. The S&P 500 dipped 0.3% to 5,832.61, while the tech-heavy Nasdaq Composite declined 0.5% to 18,490.09.
McDonald’s Faces Health Crisis
McDonald’s stock tumbled 6.1% after US health authorities reported a deadly E. coli outbreak linked to the chain’s popular Quarter Pounder burgers. The outbreak, which has resulted in one fatality and dozens of illnesses, has led McDonald’s to temporarily pull the item from menus in select states. Most of the 49 reported cases are concentrated in Colorado and Nebraska, according to the US Centers for Disease Control and Prevention (CDC).
The fast-food giant’s response to the outbreak, including the removal of the product in affected regions, has triggered concerns over potential long-term damage to its brand and revenues.
Starbucks Lowers Sales Outlook
Starbucks also weighed on the market, falling 1% after lowering its fourth-quarter global sales forecast. The coffee chain cited a projected 7% decline in comparable sales, driven by weaker-than-expected revenue performance in North America.
