Bond Yields Soar as Stocks Slide on Higher Oil Prices
US and European stocks traded mainly lower on Tuesday due to rising bond yields and a decline in oil prices. The US 30-year Treasury yield reached 5.62%, its highest level since 1992, while the benchmark 10-year yield stood at 5.25%, also a 19-year high.
Art Hogan from B. Riley Wealth Management noted that 'higher yields continue to pose a significant headwind for investors.' The Dow Jones fell 0.26%, the Nasdaq index dropped 0.09%, and the broader S&P 500 index lost 0.17%.
Oil prices had surged on Monday but reversed course after President Donald Trump said he expected talks with Iran to develop and reports that considerable volumes are continuing to flow from the region.
The US central bank, the Federal Reserve, raised interest rates earlier this month by 25 basis points to combat high inflation. The president of the Federal Reserve Bank of New York stated that the Fed does not need to raise interest rates with 'urgency' but may require a further increase later this year.