U.S. Stocks Dip Amid Rising Treasury Yields and Middle East Tensions

U.S. stock indexes fell on Monday as climbing Treasury yields prompted investors to reassess the Federal Reserve's rate cut expectations. Rising tensions in the Middle East also influenced market activity. The Dow, S&P 500, and Nasdaq all experienced declines, with most sectors lagging, except for energy stocks.

On Monday, U.S. stock indexes dropped as escalating Treasury yields triggered a market recalibration regarding Federal Reserve interest rate cuts. Rising geopolitical tensions in the Middle East further complicated the market outlook, causing traders to proceed with caution.

Investors responded to the surge in Treasury yields as the 10-year note exceeded 4% for the first time in several months, reassessing the likelihood of the Federal Reserve's rate path. Market bets for a minor rate cut in the upcoming Fed meeting are already high, following unexpectedly robust payroll data.

The broader market experienced declines, with the Dow Jones, S&P 500, and Nasdaq all losing ground. Energy stocks, however, bucked the trend, as oil prices boosted the sector amid concerns over potential disruptions due to Middle East conflicts.

(With inputs from agencies.)