Shares of social media stocks, including Meta Platforms Inc (NASDAQ:FB), Pinterest Inc (NYSE:PINS) and Snap Inc (NYSE:SNAP) are trading lower in sympathy with the overall market amid a rise in U.S. Treasury yields as investors continue to weigh the Federal Reserve's rate hike outlook.
The sector is also pulling back after gaining earlier in the week in sympaty with Twitter Inc (NYSE:TWTR), which surged following news Elon Musk has acquired a stake in the company.
The 10-year U.S. Treasury yield is also hovering around a new two-year high, which has pressured valuations in 2022. The 10-year Treasury yield hit an intraday high of 2.660% Wednesday morning before dipping to around the 2.600% level. When interest rates rise, the value of future cash flows is reduced for growth stocks, which in turn lower the value of the stock.
