US stocks fall as bond yields rebound, oil rises despite Treasury push to lower rates

According to fresh market updates, US stocks ended softer on Thursday as a renewed climb in long-term Treasury yields weighed on sentiment, while crude prices advanced more than 2% amid continued uncertainty over the conflict involving Iran and the Strait of Hormuz.

The S&P 500 declined 0.7% to 7,654.90, while the Dow Jones Industrial Average eased 1.2% to 52,822.72. The Nasdaq Composite declined 1% to 26,080.07.

The retreat came a day after the US Treasury announced plans to at least double its purchases of outstanding government bonds in an attempt to ease pressure in the long-dated debt market.

The announcement initially pushed yields softer, but that move reversed on Thursday. The yield on the benchmark 30-year Treasury rose to 5.24%, from 5.19% a day earlier, although it remained below Tuesday's 5.33% peak.

The rebound suggested that market participants stay unconvinced that Treasury purchases alone can address the forces driving the recent sell-off in longer-dated government debt.

Treasury Secretary Scott Bessent stated the department had several options available if yields continued to climb.

"We think that this is a thinly traded area of the market, that we're in August, and there's been a lot of corporate issuance that's influenced the market," Bessent told CNBC, arguing that current yields did not adequately reflect underlying economic fundamentals.

He further noted that the Treasury had a "big toolkit" and could potentially expand its bond-buying operations beyond the measures announced on Wednesday.

Market watchers, that stated, pointed to broader economic pressures behind the climb in yields, including elevated crude prices linked to the Iran conflict, heavy US government borrowing and large investments in artificial intelligence.

Arun Sundaram, senior vice president at CFRA Research, stated the latest climb in yields indicated that markets viewed the Treasury's intervention as addressing symptoms rather than the underlying problems.

Sundaram additionally cited uncertainty surrounding incoming The US central bank Chair Kevin Warsh, whose approach to communicating future monetary policy could add another layer of uncertainty for market participants.

Crude prices provided another source of pressure for markets. Brent crude rose 2.4% to $93.78 a barrel, while US West Texas Intermediate advanced 2.4% to $87.83, as the standoff over shipping through the Strait of Hormuz revealed little sign of easing.

European markets additionally ended mostly softer, with France's CAC 40 falling 0.6% and Germany's DAX declining 0.4%. London's FTSE 100 was broadly unchanged.

Asian markets moved in the opposite direction, helped by firm upside in major technology stocks. Seoul's Kospi surged nearly 6%, with SK Hynix jumping 12.7% after announcing a $29 billion share buyback. Samsung Electronics advanced more than 9%.

Tokyo's Nikkei 225 rose 1.4%, while Hong Kong's Hang Seng advanced 0.8% and Shanghai's Composite index further noted 0.2%.

Attention now turns to the annual Jackson Hole economic symposium the week ahead, where market participants will look for signals on the future direction of US monetary policy and the incoming Fed leadership.

Fawad Razaqzada, market market observer at FOREX.com, stated the Treasury's unexpected bond-buying announcement reflected its concern over the sharp sell-off in longer-term US debt.

That stated, he argued that a lasting improvement in the bond market would require a more fundamental response, particularly measures aimed at improving the US fiscal position.