NEW YORK: Wall Street stocks fell early Tuesday after a closely watched US bond benchmark hit a 16-year high, exacerbating worries about elevated interest rates.
All three major indices were in the red after the yield on the 10-year US Treasury note rose above 4.7 percent, as it climbed to levels last seen in August 2007.
About 15 minutes into trading, the Dow Jones Industrial Average was down 0.3 percent at 33,347.25.
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The broad-based S&P 500 declined 0.4 percent to 4,271.14, while the tech-rich Nasdaq Composite Index dropped 0.5 percent to 13,228.27.
Stocks have been buffeted in recent weeks by the growing expectation that the Federal Reserve and other central banks will need to keep interest rates elevated as the recent surge in oil prices extends a period of “sticky” inflation.
Briefing.com analyst Patrick O’Hare said the reason for the latest spike in yields remained murky, pointing to speculation involving US deficit concerns and the liquidations of US treasuries by foreign holders to prop up weaker currencies.
“There hasn’t been a specific news driver to account for the bump in yields, yet that is the very reason why the bump in yields has created some added angst for investors,” said O’Hare.
Among individual companies, Eli Lilly fell 1.1 percent after announcing a $1.4 billion plan to acquire Point Biopharma Global, which has a pipeline of therapies under development to treat cancer. Point soared over 80 percent.
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