Bond Yields Surge, Stocks Retreat Amid Inflation Concerns

Stocks are retreating across global markets as bond yields surge to multi-year highs. The S&P 500 Index, Dow Jones Industrial Average, and Nasdaq 100 Index all fell by more than -0.66% today, with the S&P 500 reaching a four-week low. Oil prices jumped over +2%, boosting inflation expectations and pressuring investors to demand higher yields on bonds.

The US Federal Reserve is expected to continue raising interest rates in response to persistent inflation concerns. The markets are pricing in a 65% chance of a +25 bp rate hike at the next FOMC meeting on September 15-16. Central banks globally, including the European Central Bank and the UK's central bank, may also raise interest rates due to rising bond yields.

Chipmakers and AI-infrastructure stocks are particularly affected by the surge in bond yields, with Qualcomm QCOM down over -4% and Nvidia NVDA leading losers in the Dow Jones Industrials. Mining stocks and cryptocurrency stocks are also falling today.