US stocks closed in a bear market on Monday after a dramatic late-session sell-off, while government bond yields soared, with investors unnerved over stubbornly high inflation and the prospect of aggressive monetary tightening by central banks.
Wall Street’s equities benchmark S&P 500 slid 3.9 per cent in New York to close at its lowest level since January 2021. The move left the index more than 20 per cent below its January 2022 all-time high, a decline commonly identified as a bear market.
Government bond prices on both sides of the Atlantic also dropped dramatically, sending yields to the highest levels in more than a decade, as strong inflation readings drive central banks in the US and Europe to raise interest rates after years of relaxed policy.