US Equities Fall as Yields Rise, Iran Deal Hopes Offer Modest Relief
The US equity indices continued their downward trend on Thursday, weighed down by rising yields and oil prices. The 30-year Treasury yield reached its highest level since 2004, while the 10-year and 2-year yields hit their highest levels since June 2007 and 2024, respectively.
Oil prices surged after Iranian President Masoud Pezeshkian stated that his country would not allow freedom of navigation through the Strait of Hormuz as long as sanctions and a US blockade remain in place. This added to the already bearish sentiment caused by hawkish comments from Fed officials.
The market's losses were partially offset by a Reuters report indicating negotiations between the US and Iran exploring a path out of war, which could involve Tehran reopening the Strait of Hormuz and lifting Washington's economic blockade on Iran.
Despite this, the S&P 500 and Nasdaq closed roughly unchanged, while the Russell 2000 fell 0.1% and the Dow Jones Industrial Average dropped 0.3%. Sector breadth improved to 4 out of 11 sectors higher, but new 52-week lows exceeded new 52-week highs on both the NYSE and Nasdaq.