Stocks Drop Ahead Of Incoming US Price Data – US Market Wrap

A slide bonds dragged down stocks as another weak sale of Treasuries raised concern that funding the US deficit will drive up yields at a time when the Federal Reserve is in no rush to cut rates.

The United States auctioned $44 billion in seven-year notes at 4.650%, exceeding the pre-auction figure of 4.637%. That comes  just a day after two previous offerings totaling $139 billion saw low demand. Bond sales are exercising  increasing power across many asset classes, highlighting how monetary policy uncertainty continue to grip markets as inflation shows little signs of slowing.

The S&P 500 dropped below 5,300. American Airlines Group tumbled on a disappointing outlook. UnitedHealth Group led industry losses after saying it sees a “disturbance” coming as states pare enrollees in their Medicaid programs.

Treasury 10-year yields climbed seven basis points to 4.62%. European bond issuance this year has topped the €1 trillion ($1.1 trillion) mark more than a week before the previous record. German bond yields hit a six-month high as inflation accelerated. Australia’s latest inflation reading suggested rates will remain high for now.