Wall Street on edge as soaring yields rattle sentiment, Budget bill sparks fresh jitters

U.S. stocks looked set to deepen their weekly slump on Thursday as a controversial budget bill stoked investor concerns over widening deficits and rising interest rates.

Futures linked to the S&P 500 dipped 0.3 percent, while contracts on the Dow Jones Industrial Average fell 176 points, or 0.4 percent. The Nasdaq 100 futures were also under pressure, down 0.2 percent. The S&P 500 has already shed nearly 2 percent so far this week.

The latest bout of selling came after the U.S. House of Representatives, in a party-line vote, cleared a bill that proposes sweeping tax cuts and higher military spending — a combination that could significantly inflate the national deficit. With the legislation now headed to the Senate, bond markets flashed red.

The 30-year Treasury yield surged to around 5.1 percent, marking its highest level since October 2023, while the 10-year yield hovered just under 4.6 percent. The sharp uptick in long-term borrowing costs, which influence everything from mortgage rates to auto loans, has added fresh strain to inflationary risks from recently imposed Trump tariffs.