The benchmark 10-year yield climbed almost 4 basis points to above 1.38% and was closing in on the key 1.5% area that if reached would cause stock-market dislocations, according to a number of Wall Street strategists.
The rise in yields comes as the U.S. House of Representatives neared a vote on President Biden’s $1.9 trillion COVID-19 relief package. The bill’s passage would likely intensify investor worries about inflation coming in the months ahead as the trillions in COVID-19 relief make their way through the U.S. financial system.
Dow Jones Industrial Average futures were trading lower by 202 points, or 0.64%, while S&P 500 futures and Nasdaq Composite futures were weaker by 0.78% and 1.29%, respectively.
Looking at stocks, Boeing Co. has recommended airlines suspend flights of its 777 jets that use Pratt and Whitney PW4000 engines, made by Raytheon Technologies Corp., after a United plane’s engine broke apart in the skies over Denver on Saturday.
In deals, Goodyear Tire & Rubber Co. has agreed to buy rival Cooper Tire & Rubber Co. for $2.8 billion in cash and stock. The deal will pay Cooper Tire shareholders $41.75 per share in cash and .907 newly issued Goodyear shares for each Cooper Tire share they own.
Meanwhile, M&T Bank Corp. will acquire People’s United Financial Inc. for $7.6 billion, a 13% premium to Friday’s closing value, in stock. People’s United shareholders will receive 0.118 M&T Bank shares for each People’s United share they own.
Kohl’s Corp. shares were sharply higher after a group of activist investors with a combined 9.5% stake nominated nine directors to the department store chain’s board.
In earnings, Dish Network Corp. reported quarterly revenue rose 41% year over year despite a decline in the number of pay-TV subscribers.
In commodities, Brent crude oil climbed 54 cents to $63.45 per barrel after Goldman Sachs Group raised its $75 per barrel for the third quarter of this year. Gold, meanwhile, was up $18.30 at $1,795.70 per ounce.
European markets were trading lower across the board with France’s CAC 40 down 0.48%, Britain’s FTSE 100 weaker by 0.5% and Germany’s DAX 30 sliding 0.57%.
In Asia, Japan’s Nikkei advanced 0.46% while Hong Kong’s Hang Seng and China’s Shanghai Composite declined 1.06% and 1.46%, respectively.