Wall Street’s worry du jour? The big move higher in yields

The bull market in stocks now has something new to worry about now: sky-high yields around the world. The long-term U.S. 30-year Treasury bond yield topped 5.1% on Friday, touching its highest level going back to May 22, 2025. In the U.K., 30-year Gilt yields reached levels not seen in nearly three decades. Thirty-year yields on Japanese and German bonds also hit their highest levels since the late 1990s. Those gains come as oil prices remain elevated amid the ongoing U.S.-Iran war. Higher crude prices are seeping through to consumer and wholesale goods in the U.S., based on new data released this week by the Bureau of Labor Statistics. On top of that, a new Federal Reserve chief with a dovish bias is set to take over the central bank. "Global sovereign bonds no longer ignore these numbers," wrote Ben Emons, portfolio manager of Highline Wealth Partners. "Bond yields confront the Thucydides Trap; markets react to a rising-power-versus-ruling-power dynamic. Rather than between nations, the conflict is between fiscal dominance (the rising power) and monetary policy credibility (the incumbent power)." US30Y 1Y bar US 30-year bond yield "Fiscal dominance involves large deficits, heavy Treasury issuance, a rising interest expense burden, and the market's sense that fiscal policy overwhelms monetary policy," he added. …