Global Markets Plummet Amid Bond Sell-Off and Surging Oil Prices

A global bond sell-off and surging oil prices pushed markets into the red on Tuesday. The market worries that energy-driven inflation could lead to interest rate hikes, which in turn would hurt economic growth.

The Dow Jones index closed down 0.8%, while the tech-heavy Nasdaq lost 1%. Heavy bond selling sent government borrowing costs soaring, with key rates reaching their highest levels since the global financial crisis of 2007-08.

Oil prices jumped nearly 5% as renewed fighting between the US and Iran pushed supply worries to the forefront. Traders are now awaiting key economic data ahead of the US Federal Reserve's policy meeting on September 16, which could play a major role in whether interest rates are lifted.