US Stocks Fall Further From Their Records After Bond Markets Crank up the Pressure

U.S. stock markets declined further Tuesday, marking their third consecutive loss after bond market pressures intensified. The S&P 500 fell 0.7%, the Dow Jones Industrial Average dropped 322 points (0.6%), and the Nasdaq composite sank 0.8%, reversing some of their recent record-setting gains. Rising Treasury yields, driven by inflation concerns and geopolitical tensions, weighed on investor confidence, making stocks appear overvalued. Tech stocks led the decline, reversing earlier surges fueled by artificial-intelligence excitement. Oil price volatility—stemming from uncertainty over Iran’s potential closure of the Strait of Hormuz—also contributed to market jitters. Higher bond yields, including the 10-year Treasury at 4.66% (up from 4.61% late Monday), increased borrowing costs for loans and mortgages, further pressuring equities. Nvidia, a key tech heavyweight, fell 0.8% ahead of its quarterly earnings report due Wednesday. The company’s performance will be critical in determining whether the broader market can sustain its rally. Analysts at Barclays Capital warned of a potential reversal after months of aggressive stock fund inflows, noting that investor sentiment may shift. Among individual stocks, Akamai Technologies dropped 6.3% after announcing a $2.6 billion convertible note offering. Meanwhile, Home Depot rose 0.9% after early losses, as its earnings slightly exceeded expectations despite weaker performance in older stores. CEO Ted Decker attributed strong demand to persistent consumer spending despite high gasoline prices and housing affordability challenges. Bond market disquiet remains the primary threat to the market’s recent record highs. Rising yields, now near their highest levels since Iran tensions escalated, are slowing economic growth and making equities less attractive. Oil prices eased slightly to $111.28 per barrel but remain well above pre-war levels, adding to market uncertainty.