US Stocks Plummet Amid Soaring Bond Yields and Oil Price Volatility
US stock markets dropped significantly on Monday after oil prices and bond yields rose to new heights. The S&P 500 fell 0.8% and gave back much of its gain from last week, while the Dow Jones Industrial Average dropped 347 points, or 0.7%. The Nasdaq composite sank 0.9%, as stocks felt pressure due to rising Treasury yields.
The yield on the 10-year Treasury briefly topped 5.27% before pulling back to 5.23%, up from 5.17% late Friday. This marks a return to levels seen in 2007, before the financial crisis and Great Recession sent yields toward zero. The 30-year Treasury yield rose to 5.55% from 5.49% and is now at its highest level since 2004.
Treasury yields have been rising due to concerns about inflation, Washington's massive debt load, and signs that the US economy remains solid despite challenges. Higher yields make borrowing money more expensive for everyone and undercut prices for stocks and other investments.