Traders are active on the New York Stock Exchange during morning trading on September 14, 2026.
The Dow Jones Industrial Average experienced its third consecutive drop on Thursday, influenced heavily by Treasury yields which are at their highest levels in decades, impacting the more cyclical segments of the market.
The 30-stock index decreased by 161.61 points, or 0.31%, settling at 51,349.98. The S&P 500 also fell slightly, down 0.02% to 7,704.13. Conversely, the Nasdaq Composite managed to gain a little, rising by 0.01% to 26,939.37.
Stocks climbed back from earlier lows after Reuters reported that negotiators from the U.S. and Iran in New York are considering a potential deal to gradually end the conflict in the Middle East, which would involve Iran reopening the Strait of Hormuz and the U.S. lifting its economic restrictions on Tehran.
Despite this news, oil prices and bond yields remained high. Brent crude, which serves as the international benchmark, surged over 3%, closing above $106 per barrel, while U.S. West Texas Intermediate futures rose by 2.7%, closing at $94.61 per barrel.
The 30-year Treasury bond yield reached 5.501%, a level unseen since June 2004. The benchmark 10-year Treasury note yield increased significantly to 5.223%, marking a high not seen since June 2007. Additionally, the 2-year note yield went up to 4.941%.
As yields rose, so did the speculation about future rate hikes by central bank policymakers. According to Fed funds futures trading, there is nearly a 71% chance that the Federal Reserve will raise its key rate again in October, an increase from about 55% just a week ago.
Higher bond yields typically put pressure on consumers, especially as they face increasing borrowing costs, all while already dealing with higher fuel prices.
Interestingly, Wednesday’s reports from S&P Global’s manufacturing and services purchasing managers’ indexes indicated that U.S. businesses are thriving.
Jason Stephens, founder of Evertern Wealth, commented, “The economy continues to show remarkable resilience, but that strength is keeping inflation concerns alive and pushing interest rates higher. The bond market may be the most crucial market to observe right now.”
He further mentioned that the primary concern isn’t whether the Fed will raise interest rates again but rather how long rates will remain high and what impact a 10-year Treasury above 5% will have on housing, corporate borrowing, private markets, and equity valuations.
Stephens pointed out that energy prices are “one of the biggest swing factors,” noting that any sudden change in oil prices due to the Middle Eastern conflict could directly influence discussions about inflation and interest rates.
Ultimately, he described the current market situation as exhibiting an “interesting contradiction,” where investors are anxious about rates because economic data appears robust, rather than due to a faltering economy.
Additionally, Oracle was among the significant laggers on Thursday, with its stock dropping 3.5% after Bloomberg News reported that the company was invoking force majeure to shield itself from delays related to a data center project in New Mexico.
