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30-year Treasury yield is above 5% again — that’s usually a bad sign for stocks - MarketWatch

1. U.S. government debt selloff raises 30-year bond yield above 5%. 2. Higher yield typically signals negative outlook for equities. 3. DJIA fell by over 300 points, reflecting investor concerns. 4. Moody's downgrade of U.S. debt adds to market uncertainty. 5. Uncertainty surrounds the upcoming 20-year Treasury bond auction.

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FAQ

Why Bearish?

Historically, when the 30-year yield exceeds 5%, equities suffer. Recent examples include multiple declines in October 2023.

How important is it?

The bond market's state directly affects borrowing costs, influencing corporate profits and investor sentiments related to DJIA.

Why Short Term?

Market reactions to bond yields and fiscal news are typically immediate. Previous selloffs have resulted from rising yields and concerns over debt.

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