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US: Stocks drop as bond yields spike
[NEW YORK] US stocks opened lower Tuesday as worries about spiking bond yields outweighed news that Verizon would buy AOL for US$4.4 billion.
Five minutes into trade, the Dow Jones Industrial Average was at 17,992.67, down 112.50 points.
The broad-based S&P 500 dropped 12.97to 2,092.36, while the tech-rich Nasdaq Composite Index lost 36.86 at 4,956.71.
Bond yields in the US lingered at high levels after a big jump Monday. Similar shifts were also roiling European equity markets.
"Fear over the accelerating bond market rout is causing a collapse of European stocks on Tuesday and feeding through to a considerably lower US market open," said a post from Jasper Lawler of CMC Markets.
AOL shot up 17.7 per cent on news the Internet pioneer would be bought by Verizon in an effort to boost the telecom giant's presence in online media and advertising. Verizon fell 1.3 per cent.