US Stocks Slide as Bond Yields Jump on Strong Economy and High Oil Prices
US stocks declined on Wednesday after the yield on the 10-year Treasury jumped to 5.10% from 4.96%, a significant move that undercut stock prices and slowed economic growth.
The S&P 500 fell 0.8% while the Dow Jones Industrial Average dropped 352 points, or 0.7%. The Nasdaq composite sank 1.1% from its all-time high.
Oil prices rose to $103.08 per barrel after briefly declining from a peak of $110 last week. This increase in oil costs could lead to higher inflation and business expenses being passed onto customers in the coming months.
The strong economic report suggested growth in US business activity surged to its strongest level in over five years, indicating potential for more inflation. The Federal Reserve raised interest rates last week to slow down inflation, with Fed Gov Michael Barr stating that further hikes 'are likely to be needed' to reach the 2% target.