US stock markets declined as oil prices and bond yields increased pressure, with the S&P 500 falling by 0.4%, the Dow Jones dropping 328 points (or 0.6%), and the Nasdaq declining by 0.8%. In contrast, Australian sharemarket futures indicated a possible gain of 0.4% at open on Wednesday. The yield on the 10-year Treasury note rose to its highest level since early 2023, reaching 5.00%, affecting borrowing costs and stock valuations negatively.
Written by the local model on 2026-09-16,
using this article's own text rather than the other coverage of the
same event.
US stocks slipped after oil prices and the bond market cranked up the pressure on Wall Street.
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prices → slip → Street
The S&P 500 fell 0.4 per cent.
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S&P → fall → ?
The Dow Jones Industrial Average dropped 328 points, or 0.6 per cent, and the Nasdaq composite sank 0.8 per cent.
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composite → drop → ?
The Australian sharemarket is set to rise, with futures at 6.18am AEST pointing to a gain of 31 points, or 0.4 per cent, at the open.
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futures → set → open
The ASX lost 0.9 per cent on Tuesday as it closed at its lowest level in almost three months.
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it → lose → months
The Australian dollar was lower at US71.31¢.
Wall Street felt pressure as the yield on the 10-year Treasury, which is the centrepiece of the US bond market, climbed to 5.00 per cent from 4.97 per cent late Monday and briefly touched 5.04 per cent overnight.
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which → feel → cent
It’s been jumping to its highest level in years, and Monday was the first time it breached 5 per cent since 2023.
Higher yields mean everyone from the US government to households to businesses must pay more in interest to borrow money, which slows the overall economy.
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which → jump → economy
They also make people less willing to pay high prices for stocks because they can earn more from sitting in bonds, which are considered safer investments.
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which → make → bonds
“The result is a market that must work harder to generate earnings growth just as investors become less willing to pay premium valuations for that growth,” according to Darrell Cronk, president of Wells Fargo Investment Institute.
uncertain
investors → work → Institute
The last time the 10-year yield was consistently above 5 per cent was around the turn of the millennium, and it’s been a long march back since it bottomed out below 0.50 per cent in 2020.
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it → bottom → 2020
The pace has accelerated since February, after the war with Iran sent oil prices much higher.
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war → accelerate → prices
That raised worries about high inflation potentially lasting for years, which are layering atop longstanding concerns about the US government’s massive debt level and other issues.
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which → raise → level
Oil prices rose further Tuesday following several sharp swings in the morning.
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prices → rise → morning
The price for a barrel of Brent crude, the international standard, climbed 2.9 per cent to settle at $108.75.
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price → climb → 108.75
It remains well above its $US72 level from early July and from before the war with Iran began in February, as doubt continues about whether the fighting will allow oil tankers to freely exit the Persian Gulf anytime soon through the Strait of Hormuz.
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tankers → remain → Hormuz
Inflation remains high enough that the widespread expectation is that the Federal Reserve will announce on Wednesday that it will hike the federal funds rate for the first time in three years.
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it → remain → years
Traders are still betting on a slight chance that the Federal Reserve could hold off on hiking interest rates, though.
uncertain
Reserve → bet → rates
If it does, the market could swing because investors may see it as a sign that the Fed is less committed to getting inflation lower.
uncertain
inflation → do → sign
Fed officials will also release forecasts for where they see interest rates heading in upcoming years, providing another opportunity to inject uncertainty into the market.
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rates → release → market
On Wall Street, stocks of companies that depend on customers having enough spare cash to spend on their products fell to some of the sharper losses.
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customers → depend → losses
Chipotle Mexican Grill dropped 5.9 per cent.
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Grill → drop → ?
Darden Restaurants, the company behind Olive Garden and Longhorn Steakhouse, sank 4.3 per cent.
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Restaurants → sink → Garden
Dollar Tree, whose customers may have less financial cushion than others, fell 5.4 per cent.
uncertain
customers → have → others
Dave & Buster’s Entertainment tumbled 19 per cent after reporting weaker results for the latest quarter than analysts expected.
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analysts → tumble → quarter
Elsewhere on Wall Street, stocks enmeshed in the cryptocurrency industry sank after the US Senate voted to block legislation creating a new regulatory framework for crypto, while demanding more limits on President Donald Trump’s investments.
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Senate → enmesh → investments
The price of Bitcoin slumped 4.2 per cent to $US75,920 at 6.50am AEST.
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price → slump → AEST
Coinbase Global fell 10.1 per cent, and Robinhood Markets lost 3.4 per cent.
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Markets → fall → cent
Several artificial-intelligence stocks meanwhile held steadier following their worldwide slide the day before, after leaders of the AI industry called for a slowdown in development to address safety issues for humanity.
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leaders → hold → humanity
Nvidia added 0.6 per cent a day after its 3.4 per cent drop was the heaviest weight on the S&P 500 index.
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drop → add → index
Advanced Micro Devices climbed 2.2 per cent.
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Devices → climb → ?
Such stocks led the US market to records for years, but they’ve come under pressure recently on worries that their prices shot too high in the frenzy around AI.
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prices → lead → AI
All told, the S&P 500 fell 34.25 points to 7,585.73.
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S&P → tell → 7,585.73
The Dow Jones Industrial Average dropped 328.09 to 52,093.11, and the Nasdaq composite fell 204.84 to 25,981.57.
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composite → drop → 25,981.57
In stock markets abroad, indexes fell across much of Europe and Asia.
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indexes → fall → Europe
But for several, the drops were not as sharp as Monday’s caused by the slide for AI stocks.
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drops → cause → stocks
South Korea’s Kospi index, for example, fell 0.9 per cent following Monday’s 3.3 per cent drop.
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index → fall → drop
The Aporia
