US Stocks Fall as Rising Oil Prices and Treasury Yields Weigh on Markets

Wall Street closed lower on Monday as a punishing bond market selloff and climbing crude prices drained momentum from equities. Futures for the Dow Jones Industrial Average dropped 242 points (0.5%), while S&P 500 futures fell 0.5% and Nasdaq-100 futures decreased 1%. Indexes off: Dow 0.67%, S&P 0.77%, Nasdaq 0.92%. The Dow Jones Industrial Average dropped 377 points, or 0.7%, whereas both the S&P 500 and the Nasdaq Composite saw 0.5% declines. U.S. equities kicked off trading lower on Monday, September 28, with the Dow Jones Industrial Average sliding in excess of 300 points as mounting oil costs and spiking Treasury yields dampened market sentiment amid fresh tensions between the U.S. and Iran. The Nasdaq paced the downturn on Wall Street, even though Nvidia shares climbed following the chip manufacturer’s announcement of an all-time high $150 billion share buyback authorization, surpassing the $110 billion program initiated by Apple in 2024.

President Trump Rejects Iran Peace Deal and Keeps Strait of Hormuz Closed

The catalyst for the market retreat stemmed from Washington and the Middle East. Crude prices accelerated higher after President Donald Trump rejected a proposal from Iran that would reopen the crucial Strait of Hormuz and end the war. Following the U.S. president’s rejection of an Iranian peace accord, crude prices initially surged before trimming some of those gains due to expectations that Qatari negotiators would engage both nations in discussions for a potential agreement. After retreating from highs at the start of the month, oil prices have accelerated higher in recent days as hopes that a peace deal may be on the horizon have diminished. Brent crude climbed more than 4% to reach $108.68 a barrel, while West Texas Intermediate futures mirrored this movement by rising to $96.30. U.S. crude increased by 19 cents to settle at $92.60 per barrel, and Brent advanced 96 cents to close at $105.28. Following President Donald Trump’s dismissal of conditions for a ceasefire put forward by Iran, Brent crude advanced over 2% to reach $106.79 a barrel, while West Texas Intermediate futures increased by roughly 2% to $94.40. During Monday’s session, oil prices surged by more than $4 per barrel at one point after U.S. President Donald Trump turned down an Iranian initiative intended to reopen the vital Strait of Hormuz. Trump told Axios that talks would resume this week, with officials back at the negotiating table.

Global Markets Mixed as Chipmaker Earnings Boost Stocks and Oil Prices Ease

Global Markets Sell Off as Tech Tumbles and Oil Prices Breach $100

Treasury Yields Surge to Multiyear Highs as Bond Market Selloff Deepens

The sell-off in American bonds intensified on Monday following President Donald Trump’s refusal of Iran’s latest proposal to reopen the Strait of Hormuz, raising fears that the conflict’s energy market impact will be extended. The drop drove Treasury yields upward across all timelines, led by the benchmark 10-year rate climbing 9 basis points to hit 5.25%, marking a brand new 19-year high. Yields on shorter-term paper also spiked as investors prepare for the Federal Reserve to maintain its interest rate hikes to combat inflation, while 30-year government bond yields likewise increased. The yield on the benchmark 10-year U.S. Treasury note reached a fresh 19-year high, and nearly touched levels not seen since 2002. The standard 10-year Treasury yield climbed past 5.2% while the 30-year bond crossed 5.5%, with both hovering near multiyear highs and building on the previous week’s upward spike. The 2-year note had already added roughly 17 basis points over the prior week.

The upward movement in crude and diesel prices has stoked inflation fears and driven U.S. Treasury yields upward, supported by statements from Federal Reserve officials suggesting additional rate increases could become necessary if inflation pressures fail to cool following the central bank’s 25-basis-point rate hike earlier this month. CME FedWatch data indicates that markets are currently pricing in a roughly 70% probability that the Fed will implement another consecutive rate hike at its October meeting.

US Stock Futures Rise as Oil Prices Slide and Tech Stocks Rebound

Iran is driving oil prices, and oil prices are driving inflation, and inflation is driving interest rates, said Jack Ablin, chief investment strategist and founding partner at Cresset Capital Management in Chicago.

Corporate Giants Handle Regulatory Delays and Record Buybacks

Corporate developments added distinct crosscurrents to the trading session. Nvidia gains on record $150 billion share buyback announcement. Nvidia rose 1.7%, closing off earlier highs. Several AI-linked stocks led the major indexes lower. Chipmakers Advanced Micro Devices and Micron Technology fell about 3% and 2%, respectively. Amazon slipped 1%.