US open: Dow suffers triple digit slide amid bond sell-off

US stocks took a sharp turn south on Tuesday, with a sell-off in bond markets piling pressure on equities.

Just after 15:00 BST, the Dow Jones Industrial Average was down by 141 points, while the S&P 500 and the Nasdaq shed 15 and 49 points respectively.

On Monday, US bond yields reached their highest level since December and the sell-off in the government bonds continued on Tuesday, with the yield on 10-year Bunds and Australian 10-year note climbing by 12 and 13 basis points respectively.

“German bunds yields are rising faster than US treasuries and closing the yield advantage of US debt over European debt,” said CMC Markets analyst Jasper Lawler.

“US dollar-denominated assets are now becoming relatively less appealing than the equivalent European assets.”

Figures released by the Labor Department showed US job openings declined to 4.99m in March from 5.14m in the previous month, falling short of analysts’ expectations that called for a largely unchanged reading.

Meanwhile, US small-businesses sentiment improved in April, the National Federation of Independent Business said.

According to figures released on Tuesday, the NFIB index rose 1.7 points to 96.9, although the reading was the second-worst on record since October.

Later on Tuesday, investors will focus on the Federal Reserve’s report on first-quarter household debt and credit, set to be released at 16:00 BST.

At 17:45 BST, Fed member John Williams will assess the prospects of the US economy during a speech at the NY Association for Business Economics in New York.

In company news, telecoms giant Verizon Communications slid 0.32% after revealing it had agreed a $4.4bn deal to acquire media and tech group AOL, which jumped 18.2% following the news.

Web-hosting firm Rackspace Hosting plunged 12.6% after its second quarter revenue, published late on Monday, fell below estimates.

Clothing firm Gap, lost 2.91% after reporting late on Monday that its first quarter revenue had missed expectations.

The dollar fell 0.54% against the pound and lost 0.13% and 1% against the yen and the euro respectively, while gold futures climbed 0.66% to $1,190.80.

Oil prices staged a steady rebound, with West Texas Intermediate climbing 1.2% to $59.97 a barrel, while Brent gained 1.5% to $65.87 a barrel.