The 10-year Treasury yield rose 7.8 basis points to 5.19% Thursday. It has not closed this high since 2007, and the 5.1% line it crossed this week had held for 19 years.
A strong economy drove the move, not a weak one. That thread runs through everything below.
THE LONG END
The 30-year yield rose 7.4 basis points to 5.48%, its highest since 2004. The 2-year rose just 2.3 basis points to 4.92%.
That gap matters. The long end is doing most of the work, which fits the deficit worries and the weak five-year auction Semafor cited, not Fed pricing alone.
A hot growth print today would test whether short-term yields start to catch up.
STOCKS
The S&P 500 slipped 1.8 points to 7,704.13 after reversing direction twice during the day. Only three sectors rose: communication services, energy and health care.
Oracle fell more than 5% after a force majeure notice on its New Mexico data center project. For an AI-heavy index already absorbing record-level borrowing costs, that is an uncomfortable combination.
The Dow is down 0.6% this week and on pace for a fourth straight weekly loss. Today decides whether the S&P's 0.7% weekly gain holds.
OIL AND GOLD
WTI crude rose 1.04% to $93.12 and Brent gained 1.53% to $104.70 as U.S.-Iran tensions built. Oil near $100 feeds the inflation worries behind the yield climb.
That move is reversing overnight. WTI traded near $92.78, down about 2% on talk of reopening the Strait of Hormuz and a surprise 3.0 million barrel build in crude stockpiles.
Gold fell 0.56% to $4,293 as yields climbed. A metal that pays no interest has a harder case to make with the 10-year above 5%.
THE DATA AND THE FED
Weekly jobless claims fell to 197,000, beating the 201,000 estimate. New home sales jumped 6.4% to a 684,000 annual pace, well above the 620,000 forecast.
Housing beat estimates even with 30-year mortgage rates at 7.03%. That resilience is exactly what a hiking Fed watches for.
The strong data came alongside a jump in October hike odds to 66% on Wednesday, up from 8.8% a month earlier. The FOMC decides on October 28.
THE DAY AHEAD
August durable goods orders arrive at 8:30 a.m. ET. Consensus calls for a 0.3% drop after July's 1.1% gain, with core orders seen up 0.6%.
A core beat would add to the strong-growth story that lifted yields Thursday. A miss would be the first data point this week that eases pressure on the long end.
The final University of Michigan sentiment reading lands at 10:00 a.m. ET. The preliminary 47.8 was the second-lowest on record.
Strong activity paired with gloomy consumers is the split this reading tests. New York Fed President John Williams, who signaled more hikes this week, speaks again today, and Baker Hughes posts its rig count at 1:00 p.m. ET.
