The Dow Jones Industrial Average slipped 161.61 points, a 0.31% drop, to finish at 51,349.98, marking its third straight day of losses. The S&P 500 edged lower by 0.02% to 7,704.13, while the Nasdaq Composite posted a marginal 0.01% gain, ending at 26,939.37.
The slide came as Treasury yields climbed to multi‑decade highs, with the 30‑year bond hitting 5.501%—the strongest level since June 2004. The 10‑year note surged to 5.223%, the highest since June 2007, and the 2‑year yield rose to 4.941%. Fed funds futures now show a roughly 71% probability that the Federal Reserve will raise rates again in October, up from about 55% a week earlier.
Oil prices stayed elevated, with Brent crude climbing over 3% to close above $106 per barrel and U.S. West Texas Intermediate futures up 2.7% to $94.61 per barrel.
Despite the yield rally, business sentiment remained upbeat. S&P Global’s latest manufacturing and services purchasing managers’ indexes indicated continued growth in the U.S. economy.
"The economy is showing remarkable resilience, but that strength keeps inflation concerns alive and pushes interest rates higher," said Jason Stephens, founder of Evertern Wealth. "The bond market is the most important market to watch right now."
Stephens added that the key question is not whether the Fed will hike again, but how long rates will stay elevated and what a 10‑year Treasury above 5% will do to housing, corporate borrowing, private markets and equity valuations. He also noted that energy remains a major swing factor, as any rapid oil price movement tied to Middle East developments feeds directly into the inflation‑rate conversation.
In corporate news, Oracle fell 3.5% after Bloomberg reported that the company invoked force majeure to protect a data‑center project in New Mexico from potential delays.
Overall, the market is grappling with an interesting contradiction: investors are concerned about rates while economic data remain strong, suggesting the economy is not collapsing but still under pressure from higher borrowing costs.