US Stocks Plummet on Rising Oil Prices and Bond Yields

The US stock market took a hit at the start of September, with the Dow Jones, S&P 500, and Nasdaq Composite all trading downwards. The immediate trigger was a combination of higher energy prices, renewed Middle East tensions, and rising Treasury yields. Oil prices surged, with US crude above $88 a barrel and Brent near $92, which could spill over into other sectors and make things difficult for the Fed.

The technology sector took the brunt of the selling, with semiconductors like Qualcomm, Applied Materials, Analog Devices, and Texas Instruments all down. Nvidia's earnings were also in focus, with its stock price at $218.23 and market capitalization of around $5.32 trillion. The geopolitical risk factor has come back to the forefront, with renewed military activity between the US and Iran raising concerns about energy supplies and shipping.

The bond market gave a clear signal that the US 10-year Treasury yield increased to around 4.788%, the highest yield in 20 months. The Japanese 10-year yield went to 3%, the highest since 1996, while the German benchmark yield reached its highest in 2011.

The early session was volatile, with the Nasdaq falling as much as 1.3% and the Dow losing more than 300 points. Defensive and healthcare names were among the stronger performers, while Apple stood out as a major technology stock.