Stocks Slide as Treasury Yields Rise to Highest Level in Months

The stock market took a hit on Friday as Treasury yields rose to 5.004%, their highest level in months.

This led to a decline in the S&P 500, down 10.08 points or 0.13% to 7,627.68. The Dow Jones Industrial Average also fell, giving up 217.07 points, or 0.42%, to 51,560.97.

The Nasdaq Composite was the only major index to hold its ground, barely dipping into the red. However, this small gain is largely due to a few individual stocks performing well, particularly in the crypto space.

The rally on Thursday, which saw stocks bounce back from the previous day's Fed-induced sell-off, proved short-lived as investors repriced their expectations for another rate hike by the Federal Reserve in October. This shift has made stocks more sensitive to changes in Treasury yields, with the 10-year yield now competing directly with the S&P 500's earnings yield.

Crypto-related equities did stand out on Friday, however. Bitcoin surged past $80,000 and Strategy (MSTR) jumped 11.87% to $147.95 as investors reacted positively to the SEC granting a five-year exemption for tokenized stock trading.