World shares track Wall Street's retreat as bond markets crank up the
pressure
[May 20, 2026] By
ELAINE KURTENBACH
Shares retreated in Europe and Asia on Wednesday as rising bond yields
cranked up pressure on stocks and other investments, undermining the
latest AI-driven rally in technology shares.
Bond yields have been climbing as the war with Iran drags on, raising
worries over prolonged higher inflation.
U.S. futures were mixed, with the future for the S&P 500 up 0.2% while
that for the Dow Jones Industrial Average edged 0.1% lower.
In early European trading, Germany's DAX was nearly unchanged at
24,390.32, while the CAC 40 in Paris inched up 0.1% to 7,992.24.
Britain's FTSE 100 lost 0.3% to 10,303.23.
In Japan, the Nikkei 225 lost 1.2% to 59,804.41.
The yield on the 10-year Japanese government bond slipped to just below
2.8% but remained at its highest level since 1997. The dollar was
trading at 159.05 Japanese yen, down slightly from 159.09 yen late
Tuesday.
The euro slipped to $1.1591 from $1.1608.
Chinese shares also fell, with Hong Kong's Hang Seng losing 0.6% to
25,656.12. The Shanghai Composite index shed 0.3% to 4,162.10.
Australia's S&P/ASX 200 dropped 1.3% to 8,496.60.
In South Korea, the Kospi dropped 0.9% to 7,208.95 after a broad
sell-off a day earlier. Taiwan's Taiex gave up 0.4%.
U.S. futures were little changed after the S&P 500 fell 0.7% Tuesday,
closing at 7,353.61 for its third straight loss since setting its latest
all-time high.
The Dow Jones Industrial Average dropped 0.6% to 49,363.88, and the
Nasdaq composite sank 0.8% to 25,870.71.
Tech stocks are faltering following huge runs thanks to excitement over
artificial-intelligence technology that critics say made them too
expensive.
Meanwhile, oil prices have been wavering due to uncertainty about how
long the Iran war will keep the Strait of Hormuz closed for oil tankers.
Attention Wednesday will be focused on Nvidia's latest quarterly
results. The chip company has routinely blown past analysts’
expectations each quarter and provided forecasts for future growth that
have consistently topped Wall Street’s.
How it does could determine whether technology stocks and the larger
U.S. stock market can maintain their rally. Nvidia fell 0.8% Tuesday and
was one of the heaviest weights on the S&P 500 because of its immense
size.
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A currency trader talks on the phone near a screen showing the Korea
Composite Stock Price Index (KOSPI) and the foreign exchange rate
between U.S. dollar and South Korean won, left, at the foreign
exchange dealing room of the Hana Bank headquarters in Seoul, South
Korea, Wednesday, May 20, 2026. (AP Photo/Ahn Young-joon)
 Akamai Technologies dropped 6.3% for
one of Wall Street’s sharper losses Tuesday after the cybersecurity
and cloud computing company said it wants to raise $2.6 billion
through a convertible note offering.
Home Depot rose 0.9% after flipping an early loss following its
latest earnings report. Its profit and revenue edged past analysts’
expectations, but an important measure for retailers that looks at
performance for stores more than 1 year old came in below some
analysts’ expectations.
CEO Ted Decker said Home Depot saw similar demand from its customers
as it did throughout last year “despite greater consumer uncertainty
and housing affordability pressure.”
Many big U.S. companies have been reporting stronger-than-expected
profits for the latest quarter thanks in part to their customers
continuing to spend despite high gasoline prices and other
challenges. That’s helped vault U.S. stock indexes to records, but
disquiet in the bond market is threatening that.
The yield on the 10-year Treasury rose to 4.66% from 4.61% late
Monday and from less than 4% before the war with Iran began. That’s
a notable increase, and it’s part of a worldwide climb that’s making
stock prices look even more expensive and threatening to slow the
economy.
Higher yields can drive up rates for mortgages and loans going to
companies to build AI data centers, which has been a big source of
growth for the economy.
Yields rose even as oil prices eased.
Early Wednesday, U.S. benchmark crude oil was down $1.15 at $103.00
per barrel. Brent crude, the international standard, lost $1.29 to
$109.99 per barrel.
The average price for a gallon of gasoline was $4.51, according to
the AAA motor club, or about 43% more than it cost last year at this
time.
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