Stocks under pressure as correction fears grow and record rally defies geopolitical turmoil

Key points

• In this article US10Y.IXIC.SPX Follow your favorite stocks CREATE FREE ACCOUNT A trader works on the floor of the New York Stock Exchange (NYSE) during the opening bell in New York, on May 11, 2026. Angela Weiss | Afp | Getty Images Global stock markets have been on a tear in 2026, extending last year's rally as traders look through geopolitical turmoil and inflation fears.
• But bond markets are painting a different picture — and the growing divergence is ringing alarm bells for some investors.
• While many major stock indexes have erased losses incurred at the start of the Iran war, government bonds have largely taken a more cautious approach, continuing to price in higher inflation and widespread interest rate hikes.
• In the U.S., for example, the S&P 500 — up 7.4% year-to-date — has risen almost 7% since the conflict began in late February.
• The S&P 500 and the...