U.S. equities declined, and Treasury yields rose as investors are worried about inflation risks and the impact of corporate tax that could allow foreign governments to impose levies on big American companies.
Ten-year U.S. Treasury yields rose from the lowest since late April after Treasury Secretary Janet Yellen said that a slightly higher interest-rate environment would be a plus on Sunday.
Investors are trying to balance the potential decision of a higher interest rate and not missing out on a rally pushed by massive government stimulus. The U.S. consumer price index report due Thursday will be one of the last major economic indicators released before the Fed’s rate decision later this month.
Meanwhile, the Group of Seven rich nations secured a landmark deal that could help countries collect more taxes from prominent firms and enable governments to impose levies on U.S. giants such as Amazon and Facebook.
Underperformance by the tech-heavy Nasdaq 100 suggested investors are looking beyond pure growth narratives to sustain gains. The Russell 2000 Index rose for the third straight session on Monday, but it remained more than 2% below the June all-time high.
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