Stock Market Today: Stocks resume plunge as Treasury yields continue to soar

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U.S. stock index futures were lower on Monday, while U.S. Treasury yields and the dollar resumed recent gains as investors anticipated a busy week on Wall Street that could stoke inflation concerns and add further pressure to the recent rout in global stock markets.

The S&P 500 has now fallen for two consecutive weeks and is down 0.93% for the year after a better-than-expected December jobs report and uncertainty from President-elect Donald Trump’s new administration reignited inflation concerns.

The benchmark 10-year Treasury yield has largely fueled market concerns, rising to a November 2023 high of 4.801% in overnight trading, while the 2-year Treasury yield has risen 17 basis points since the beginning of the year to 4.424%.

“Stocks are struggling to gain momentum in the new year,” said Adam Turnquist, chief technical analyst at LPL Financial. “Recent signs of inflationary pressures and reduced expectations for a Fed rate cut have pushed interest rates to uncomfortably high levels, adding to the macro backdrop. becomes complicated.

“Unfortunately, near-term technical trends suggest additional upside risks to Treasury yields,” he added. “Based on this backdrop and the current technical structure of the broader market, we believe the potential for further pullbacks remains as market breadth and momentum weaken.”

The move higher in yields not only changes the calculus for broader equity prices but also provides global investors with an attractive risk-free alternative to interest rates, which will face further upward pressure this week, including December inflation and retail sales data. The unofficial start of third-quarter earnings season.

About 20 S&P 500 companies will report fourth-quarter updates this week, including JPMorgan Chase (JPMorgan Chase) Goldman Sachs (GS) Bank of America (Buck) and UnitedHealth Group (united nations institutes of health) .

On the macro front, economists expect both core and headline inflation numbers to rise slightly in December, while record holiday shopping and travel could lift retail sales closer to the $730 billion mark.

Stocks are set to open sharply lower again as the trading day begins on Wall Street, with futures contracts tied to the S&P 500 pointing to a 47-point opening loss.

Related: Bonds tumble on Fed rate cut bets as inflation welcomes Trump to White House

Meanwhile, Dow Jones Industrial Average futures are down 150 points, while the Nasdaq is down 0.77% for the month and is expected to drop 245 points.

Gainers included Nvidia (NVDA) The stock was last down 3% premarket, opening at $131.82 a share, a move that would drag the market’s second-largest stock into correction territory.

The market’s benchmark volatility index, the VIX, was also rising, rising 20.37% to $21.74 in after-hours trading, hitting its highest point in nearly a month. At this level, investors expect daily moves in the S&P 500 to be approximately 1.36%, or 79 points, over the next 30 days.

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In overseas markets, Wall Street’s plunge on Friday dragged the market lower, with the European Stoxx 600 Frankfurt Index falling 0.77%, and rising oil prices causing London’s FTSE 100 Index to remain down around 0.22%.

Overnight in Asia, Japan’s Nikkei 225 index closed down 1.05% in Tokyo, while the MSCI ex-Japan regional index fell 181% in the final trading session.

Related: Veteran money manager issues dire warning for S&P 500 in 2025