[New York Stock Exchange] U.S. Long-Term Treasury Yields and Oil Prices Surge, All Major Indexes Open Lower

30-Year U.S. Treasury Yields Rise
Global Oil Prices Climb

On August 18 (local time), all three major U.S. stock indexes opened lower on the New York Stock Exchange as the 30-year U.S. Treasury yield soared to its highest level in 19 years and international oil prices climbed amid escalating tensions between the U.S. and Iran.

As of 9:35 a.m. at the New York Stock Exchange (NYSE), the Dow Jones Industrial Average was trading at 53,324.83, down 134.95 points (0.25%) from the previous close. The S&P 500, which tracks large-cap stocks, slid 40.03 points (0.51%) to 7,705.03, while the tech-heavy Nasdaq was down 277.12 points (1.04%) at 26,367.79.

New York Stock Exchange. New York, USA - Photo by Yoonju Hwang

Market participants are closely watching movements in U.S. long-term bonds. The previous day, the 30-year U.S. Treasury yield rose more than 1 basis point (1 bp = 0.01 percentage point) to reach 5.323%, its highest level in 19 years.

According to CNBC, concerns that oil prices could remain elevated due to a stalemate in negotiations between Iran and the United States have driven bond yields higher.

According to Investing.com, the 30-year U.S. Treasury yield is currently at 5.321%, up 1.1 basis points from the previous day. The 10-year Treasury yield is at 4.731%, up 0.8 basis points, while the 2-year Treasury yield climbed 1.4 basis points to 4.196%.

Peter Boockvar, Chief Investment Officer at OnePoint BFG Wealth Partners, pointed out, "Thanks to the strong rally in AI-related stocks, the equity market has largely shrugged off the continuous rise in global bond yields, but if this interest rate trend continues, it could become a problem at any time." He added, "With a bearish outlook on long-term bonds, I expect this trend to persist."

The situation in the Middle East is also pushing oil prices higher and fueling market concerns about inflation. Mohammad Bagher Ghalibaf, Speaker of the Iranian Parliament, said in a nationally televised speech that day, "I make it clear that the Strait of Hormuz will not reopen until the U.S. fulfills the commitments specified in the MOU."

He listed the conditions the U.S. must meet: lifting the maritime blockade on Iranian ports, removing oil sanctions, unfreezing overseas assets, and ending military threats and operations.

The U.S. and Iran signed a ceasefire MOU on June 17 and began 60 days of negotiations aimed at reaching a final agreement. However, even after the 60-day deadline passed, the two sides failed to finalize a deal.

International oil prices are rising as the standoff between the U.S. and Iran drags on, with the two sides unable to narrow their differences over reopening the Strait of Hormuz and the lifting of sanctions and blockades on Iran.

At this time, on the New York Mercantile Exchange, West Texas Intermediate (WTI) for September delivery is trading at $85.29 per barrel, up 0.93% from the previous session. Brent crude for October delivery on the ICE Futures Exchange is up 0.35% at $91.19 per barrel.

Energy stocks such as ExxonMobil (up 1.84%) and Chevron (up 1.42%) are rising. Other energy shares including Occidental Petroleum (up 1.20%) and Diamondback Energy (up 1.08%) are also climbing. Defense stocks such as Lockheed Martin (up 1.39%) and Northrop Grumman (up 2.50%) are also gaining.

In contrast, major stocks by market capitalization are mostly lower. Nvidia is down 2.23%, Microsoft 0.56%, Amazon 1.04%, TSMC 3.24%, Alphabet 0.60%, Broadcom 2.51%, Meta 2.71%, and SpaceX 4.48%, respectively.

This content was produced with the assistance of AI translation services.