Stocks have rebounded strongly since early April but concerns over stalled trade deals and rising bond yields have pressured markets. The 30-year Treasury yield surpassed 5% amid worries that President Trump's proposed tax and spending bill could add \$2.5 trillion to the deficit. Treasury yields also rose following a \$16 billion twenty-year bond auction with below-average demand, reflected in a bid-to-cover ratio of 2.46 versus the historical average of 2.58.

Airline stocks substantially moved downwards, resulting in a 3.7% nosedive by the NYSE Arca Airline Index. Banking stocks were considerably weak, as reflected by the 3.1% slump by the KBW Bank Index. Oil service, housing and commercial real estate stocks saw notable weakness while gold stocks bucked the downtrend amid a continued increase by the price of the precious metal.

Asia Pacific stocks moved mostly higher on Wednesday. Hong Kong's Hang Seng Index rose by 0.6% and China's Shanghai Composite Index inched up by 0.2%, although Japan's Nikkei 225 Index bucked the uptrend and fell by 0.6%. The major European markets turned in a mixed performance on the day. While the French CAC 40 Index fell by 0.4%, the U.K.'s FTSE 100 Index inched up by 0.1% and the German DAX Index climbed by 0.4%.

In the bond market, treasuries moved sharply lower after ending the previous session roughly flat. As a result, the yield on the benchmark ten-year note which moves opposite of its price, surged 11.5 bps to 4.59%.

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