The 10-year Treasury yield is at 5% as US stocks reopen Monday, and the Dow fell more than 1.5% last week. A missile strike on Riyadh adds oil-market risk. President Trump hosts Chinese President Xi Jinping on Thursday, in talks that could move exporter and chipmaker stocks.
US stocks reopen Monday with the 10-year Treasury yield at 5%. The Dow is down more than 1.5% on the week. A missile strike on Riyadh over the weekend adds oil risk on top, and four events now shape the days ahead, from Fed speeches to a Trump-Xi meeting.
Why a 5% Yield Resets Every Share Price
A US government bond now pays 5% a year with almost no risk, and every listed company has to beat that. Yardeni Research founder Ed Yardeni has already cut his year-end S&P 500 target to 7,900 from 8,400, after being one of the most bullish forecasters on the street.
According to BeInCrypto, Yardeni warns the yield may break out above 5%: "the 10-year U.S. Treasury yield may be on the verge of breaking out above 5%". He blamed the bond market, the war in Iran and November's midterm elections.
Technology and industrials were the only sectors that rose Friday, yet higher yields hurt technology hardest because those profits sit furthest in the future. The sector holding the index up has the most to lose.
Oil Risk From the Riyadh Strike
Saudi air defenses destroyed a missile fired at Riyadh on Saturday. Brent crude still closed near $104 on Friday, up more than 13% in a month. Expensive oil splits the market: energy producers earn more while airlines and retailers pay more.
It also traps the Fed, which raised rates last week and may have to do it again. Fed Chair Kevin Warsh says inflation has stayed too high for too long.
Fed Speeches, Earnings, and the Trump-Xi Meeting
Wednesday brings S&P Global's flash survey of company managers, the first read on whether costly energy is slowing the economy. Thursday brings Trump's meeting with Xi at the White House, where tariffs, rare earths and artificial intelligence guardrails are on the table before the trade truce expires on November 10. A deal would lift exporters and chipmakers; no deal puts tariffs back in play before year end.
KB Home reports Tuesday, and mortgage rates track that same 10-year yield. Costco reports Thursday, where one analyst already warns core earnings could miss forecasts.
Traders spent Friday lifting their bets on another Fed rate rise in October. This week decides whether they were right.
Source: BeInCrypto
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