US Treasury Yields Soar to 19-Year Highs, Leaving Stocks with a Three-Day Downtrend

The US Treasury market was the biggest seismic source of the day. The 30-year US Treasury yield rose by 5 basis points to 5.18%, touching the highest level since the eve of the global financial crisis in 2007; the 10-year yield also rose in sync, with an increase of about 38 basis points in the past month, approaching the 40 basis point threshold previously set by Goldman Sachs as "posing a substantial impact on the stock market". Multiple large bond sales were seen during the US morning session, and market participants believe this points to concentrated liquidation of long positions, with selling pressure peaking around the closure of the European market. The core logic driving the bond market sell-off lies in the re-pricing of inflation expectations. Nomura strategist McElligott pointed out that the conflict in Iran has led to the continuous impact of supply shocks in energy and petrochemicals, with emergency stockpiles being rapidly depleted, combined with overheating signals from the US demand side, leading the market to reassess the global central bank policy path. The market-implied probability of a rate hike by the Federal Reserve this year has suddenly soared to over 80%, with "no rate cuts" becoming the base case and tail risk pricing for "rate hikes this year" also rising rapidly. The yield curve has shown significant bear steepening, implying that market concerns about policy errors by the Federal Reserve are intensifying. In terms of the stock market, the S&P 500 index closed down 0.67% at 7354 points, the NASDAQ 100 index fell 0.61% to 28,819 points, and the Dow Jones index fell 0.65% to 49,369 points, with small-cap Russell 2000 leading the decline, dropping 1.01% to 2747 points. This marks the third consecutive trading day that the S&P 500 closed lower. Sector performance was relatively differentiated, but overall weak. The intraday trend was quite tortuous, exhibiting a "down-bounce-down" three-stage structure. US stocks faced pressure and moved downward after the opening, and the decline intensified after the European market closed. Around 13:30 New York time in the afternoon, calls of 0DTE options saw concentrated buying, briefly pulling the NASDAQ index close to breakeven, but were immediately hit by a large negative delta flow, causing the index to move down again and eventually收盘接近当天低点 Adding to the trend, SpotGamma数据显示， this "pullback after lift" structure was particularly evident at the tail of the trading day. Semiconductors, momentum factors, and AI leading stocks were the weakest sectors of the day. After the Goldman Sachs TMT momentum basket accumulated a 22% drop in the last three trading days, it rebounded about 10% from the low point yesterday, but overall, it is still in the adjustment trend. Anxiety about Nvidia's earnings report also continues to fester, and traders generally choose to cash in AI-related long positions before the report. The current debate around AI trading has quietly shifted. Bloomberg strategist Michael Ball pointed out that AI demand expands at the speed of software, but the data center construction cycle is much longer, and faces the risk of rising input costs, this mismatch is turning AI trading from a pure growth story into a story that needs to consider profit margin constraints. Oppenheimer analyst Muniyappa added that the inference cost of tokens for mainstream large language models has risen by 12% over the past week, cumulatively up by 65% since the end of February to $2.12 per million tokens, the narrative of supply shortages is strengthened, but also brings the risk of demand contraction from end users taking the initiative to reduce usage, postponing deployment, or turning to smaller models. This makes Nvidia's earnings report a double-edged event. Even if the performance is strong, if investors use the earnings report to re-evaluate the profit distribution logic of AI capital expenditure under supply constraints, strong data may not be sufficient to support the stock price. AI trading itself may be able to withstand this re-evaluation, but the "lying win" stage is likely to have ended. McElligott of Nomura also issued an additional warning: Market makers' willingness to price some high "toxicity" targets is declining, and the market is facing negative convexity risks. The expiration of VIX options on the same day and Nvidia's earnings report the next day constitute a double catalyst for unlocking the tail of the price distribution. At the same time, as the earnings season approaches the end, the market's driving force is switching from individual performance to macro narrative, and this shift itself is worth being vigilant. The Morgan Chase Market Intelligence team maintains a "tactical bullish" stance, based on macro and micro data resilience, retail funds returning, corporate repurchases restarting, and overall optimism about recent catalysts. The team believes that any pullback