US Stocks Slide Amid Oil Price Surge and Rising Yields

The US stock market started September under pressure due to higher oil prices and rising global bond yields. The Dow Jones Industrial Average fell by 301 points, or 0.6%, while the S&P 500 declined 0.7% and the Nasdaq Composite dropped 1.1%. Technology stocks were particularly affected, with Nvidia, AMD, and Micron each falling around 2%. Microsoft and Alphabet also declined by more than 1%

The rise in crude oil prices added to inflation concerns, while increasing yields on bonds made them relatively more attractive compared to equities.

Investors are reassessing the Federal Reserve's interest-rate path due to rising US Treasury yields. The US 10-year yield hit a 20-month high of 4.7880%. Higher yields can create additional pressure on stocks, particularly growth companies whose valuations are sensitive to borrowing costs and discount rates.

Renewed US-Iran tensions have increased geopolitical uncertainty, which is also impacting the market. The Strait of Hormuz was struck by three unknown missiles, adding to the threat of retribution and potential disruption to energy supply chains.