US equity indices closed lower again yesterday. The S&P 500 fell 0.52%, the Nasdaq 100 declined 0.32%, and the Dow Jones Industrial Average lost 1.06%.

The 30-year US Treasury yield rose two basis points to 5.32%, returning to levels not seen since June 2007. The 10-year yield added one basis point to 4.73% after a three-basis-point rise on Monday.

Rising yields reflect investor concern about rapidly growing government spending, a wave of long-dated debt issuance, and inflation that has remained above the Fed's target for a fifth consecutive year. Notably, traders increased their focus on the debt market even after two benign inflation reports this month that had reduced odds of a Fed rate hike next month.

A second driver of the sell-off is oil. Brent rose 0.4% to $91.25 per barrel after President Trump said he is not interested in extending an expiring deal with Iran, and fighting flared again in Lebanon. Renewed Middle East tensions and the oil rally are reviving inflation worries at a moment when prospects for a US-Iran settlement are fading and the question of reopening the Strait of Hormuz has resurfaced.

The combination of higher oil prices, rising Treasury yields, and renewed geopolitical risk will likely keep markets volatile, and traders will remain particularly sensitive to any further news from the Middle East.

Equity markets took the developments badly. Asian stocks gave up morning gains, and the regional MSCI index fell about 1.0%. South Korea's KOSPI slid 3.4% and ended the day down roughly 2.0%; Japan's Nikkei 225 lost 2.3%. Nasdaq 100 futures continued lower today, down about 0.7%, and European indexes are trading in negative territory.

Gold eased 0.5% to roughly $4,395 an ounce.

A technical picture for the S&P 500 suggests that the immediate task for buyers today is to clear resistance at $7,718. That will show strength and open the way to $7,737. Controlling $7,756 will further cement the bulls' position. On the downside, if risk appetite ebbs, buyers should defend $7,698. A break there will quickly push the index back to $7,679 and open the road to $7,656.