It's on fire, everything is falling, and no one is coming to the rescue

Source: Wall Street Intelligence Circle

The fire has not stopped; instead, it is beginning to spread to more markets. When stocks, gold, and bonds are all under pressure, investors are realizing that this time, no one is coming to the rescue.

After waking up, the global market seemed to be on fire, with flames reaching the sky:

- US stocks fell across the board: Dow Jones dropped 0.97%, S&P 500 down 1.21%, and Nasdaq fell 2.15%;

- The “Seven Tech Giants” experienced their biggest single-day drop since April 2025, with the sector index falling 4.8% and $797 billion wiped off market value;

- Gold prices fell nearly $100, testing the $4,000 level again;

- Meanwhile, US crude closed above $90, Brent crude surpassed $100, the 10-year US Treasury yield settled at 4.69%, and the US Dollar Index remained well above 101.

Now, everywhere is a focal point, and everywhere has loopholes.

First, although the opening and closing of the US stock market differ little, the Nasdaq fell more than 2%, twice the drop of the Dow. Thursday's opening was an alarm; the close was confirmation.

Second, the 10-year US Treasury yield is approaching 4.7%, one of the most important stress signals in the current global market. While 4.7% itself isn’t a “magic number,” it indicates that the bond market no longer sees the Middle East conflict as a pure safe-haven event. 4.7% directly suppresses US stock valuations, especially for tech stocks, and makes it harder for the Federal Reserve to calm the market—meaning the market is moving from “we can tolerate it” to “there’s a need to recalculate.”

Third, Brent crude has broken above $100, making oil prices the number one variable in the global market. As long as it stays over $100, it will be very difficult for the market to return to the comfortable narrative of “cooling inflation, Fed on hold, and AI continues rallying.” In the past, whenever oil surged, the market could reassure itself: it was just a Middle East risk premium, and as long as US-Iran negotiations resumed or the Strait of Hormuz became navigable, prices would retreat. This time, however, the risk has spread from a single strait to multiple supply lines. Houthi attacks on Saudi oil tankers have extended risk from the Persian Gulf to the Red Sea.

Fourth, in the past, when there were “danger moments” in the market, Trump would change his behavior to affect market trends, but this time he seems to be acquiescing. Last night, even as the 10-year Treasury yield surged to 4.7% and US stocks tumbled, Trump did not offer comforting words to the market. Instead, he told AXIOS he is considering restarting large-scale military operations in Iran. The market is beginning to realize that political goals and market goals may not align.

What gave the market its biggest confidence in the past was the belief that any risk would eventually be resolved; now, markets are starting to worry that some risks will not disappear immediately, but will gradually transmit to oil prices, inflation, interest rates, and then to every asset. This is what truly makes last night’s decline worthy of caution.