Stocks are down due to bond yields rising on deficit concerns

From Nasdaq: 2025-05-21 12:13:00

Stock indexes are down today, with the S&P 500, Dow Jones, and Nasdaq all in the red. Trade war concerns and a Moody’s credit rating downgrade are contributing factors. Bond yields are rising, with the 10-year T-note yield up. The focus this week is on tariff news and trade deals.

US deficits are driving bond yields higher, with House Republicans agreeing to raise SALT deductions. Geopolitical risks are elevated, with reports of potential Israeli strikes on Iranian facilities. MBA mortgage applications fell, with rates rising. The upcoming week includes G-7 meetings and economic data releases.

Markets are pricing in a 2% chance of a rate cut at the next FOMC meeting. Q1 earnings season is wrapping up, with strong beats and earnings growth. Overseas markets show mixed results. Interest rates are under pressure, with T-notes declining. European bond yields are also on the rise.

The ECB warns of shifts in capital flows, indicating a potential regime change. UK CPI data shows higher inflation rates. Swaps predict a rate cut by the ECB. Stock movers include Palo Alto Networks, Target Corp, VF Corp, and UnitedHealth Group. Credit reporting firms and gaming companies are also in focus.

Key companies like Keysight Technologies, Dycom Industries, and L3Harris Technologies are seeing stock gains. XP Inc also reports positive earnings. Earnings reports for May 21 include Lowe’s, Medtronic, Snowflake, Target, VF Corp, and Zoom Communications. Market insights and news from Barchart provide additional context for investors.



Read more at Nasdaq: Stocks Decline as Bond Yields Rise on Deficit Concerns