© Reuters. FILE PHOTO: Traders work on the trading floor at the New York Stock Exchange (NYSE) in New York City, U.S., January 27, 2023. REUTERS/Andrew Kelly

By Shreyashi Sanyal and Johann M Cherian

(Reuters) – The Nasdaq fell on Friday as megacap growth stocks came under pressure after Treasury yields extended gains, while shares of ride-hailing firm Lyft plunged following a downbeat profit forecast.

The Nasdaq eyed its first weekly fall this year, while the and the Dow were set to clock declines for a week dominated by hawkish commentary from U.S. Federal Reserve officials and earnings reports from more than half of the S&P 500 constituents.

Yields on the benchmark 10-year Treasury note rose to their highest in more than a month following an auction of 30-year bonds that saw weak demand. [US/]

“It’s always about why those yields are moving higher … if they’re moving higher due to inflation expectations going up, that tends to be more negative for growth stocks,” Brian Jacobsen, senior investment strategist at Allspring Global Investments, said.

The Russell 1000 Growth index that houses many large-cap growth names fell 0.9%.

Lyft Inc (NASDAQ:) plummeted 36.5%, on track for its biggest one-day percentage decline, as it also lowered prices, raising concerns it was falling behind bigger rival Uber Technologies (NYSE:) Inc. Uber shares dropped 3.9%.

At 12:58 p.m. ET, the was up 107.24 points, or 0.32%, at 33,807.12, the S&P 500 was down 3.75 points, or 0.09%, at 4,077.75, and the was down 113.97 points, or 0.97%, at 11,675.61.

Seven of the 11 major S&P 500 sectors fell, with consumer discretionary stocks dropping 1.6%. The energy sector jumped 3.3% as oil prices climbed on Russia’s plans to cut crude supplies. [O/R]

Sharpie maker Inc slid 2.1% on lower-than-expected annual forecasts, while also announcing the retirement of Chief Executive Ravi Saligram.

More than half of the firms listed on the S&P 500 have reported earnings with 69% beating profit estimates for the quarter, according to Refinitiv data.

U.S. consumer sentiment improved further in February month-on-month, but households expected higher inflation to persist over the next 12 months, the University of Michigan’s preliminary February reading showed.

After U.S. equities were rattled over the week by strong jobs data, investors await January consumer inflation data due next week for clarity on the Fed’s rate-hike path.

Declining issues outnumbered advancers for a 1.25-to-1 ratio on the NYSE and a 1.63-to-1 ratio on the Nasdaq.

The S&P index recorded two new 52-week highs and no new low, while the Nasdaq recorded 25 new highs and 58 new lows.

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