Sep 25, 2026 · 10 min
Rising yields and oil pressure stocks before key geopolitical tests
Yields, China, Iran All in Focus as Weekend Nears
The episode connects bond-market stress, higher energy prices, government borrowing, and geopolitical uncertainty to the forces shaping near-term stock performance.
- 1Weak Treasury demand and heavy government borrowing are pushing yields higher and adding pressure to stocks.
- 2Higher oil prices are increasing market concern as investors watch developments involving Iran and the Middle East.
- 3Trump’s meeting with Xi and upcoming consumer sentiment data could provide fresh clues about market direction.
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The episode brings bond-market weakness and higher oil prices together as simultaneous pressures on stocks.
The brief
Colette O'Claire opens the Schwab Market Update with a Friday outlook centered on a weakening bond market and mounting pressure on stocks.
Rising Treasury yields reflect poor auction demand and heavy government borrowing, creating a tougher backdrop for equities as financing conditions tighten.
Higher oil prices add another source of pressure, while developments involving Iran and the Strait of Hormuz keep Middle East risks in view.
Investors are also watching Trump’s meeting with Xi and upcoming consumer sentiment data for signals that could clarify the market’s next move.
The episode’s central tension is whether political and economic developments can offset the drag from stressed bonds, expensive oil, and weaker stock sentiment.
What was said on this episode
11 statements · 1 positive · 8 negative · 2 neutral
The 10-year Treasury yield’s 2007 high may act as resistance today.
“That level could represent a resistance point to watch today.”
Listen at 1:00
The two-year Treasury yield generally reflects expected Fed funds rates one year ahead.
“Generally, the two-year Treasury yield is a good representation of where the markets expect the Fed funds rate to be in one year's time.”
Listen at 2:42
Fed rate hikes can increase short-term investment yields.
“Fed rate hikes could pull up the yields on short-term investments.”
Listen at 2:54
Higher short-term asset yields compete with stocks for investor cash.
“When yields on the assets rise, they compete with stocks for investor cash, another potential challenge for Wall Street.”
Listen at 3:07
Utilities and staples tend to underperform when yields rise.
“Certain sectors, notably utilities and staples that offer dividends, tend to lose ground when yields rise”
Listen at 3:15
High-borrowing and long-duration growth stocks are more sensitive to rising yields.
“Stocks with heavy borrowing needs or earnings growth seen farther out in the future can be more sensitive to rising long-term yields, which may clip profits.”
Listen at 3:34
Oracle borrowed heavily to finance its AI expansion.
“Oracle, which fell 3.45% Thursday, borrowed heavily to finance its AI footprint”
Listen at 4:01
Strong manufacturing and services data could keep inflation elevated.
“Robust U.S. manufacturing and services data this week raised concern that blistering economic growth could keep inflation elevated.”
Listen at 4:34
A tight labor market can eventually raise wages.
“A tight labor market can ultimately push wages higher”
Listen at 6:06
Preliminary University of Michigan sentiment was historically weak at 47.8%.
“The preliminary reading of 47.8% was historically weak”
Listen at 6:18
MGM Resorts shares fell 11% after its takeover offer was rescinded.
“MGM Resorts fell 11% after a takeover offer was rescinded.”
Listen at 8:39
Statements are attributed to the speaker as said on the episode and reflect their view at the time, not PodLume's. They are not advice.