US bond yields hit a post-2007 high as Wall Street experts warn a stock market crash cannot be ruled out

From the Newshound archive · first published 25 September 2026 · last updated 26 September 2026.

The benchmark 10-year US Treasury yield climbed above 5% for the first time since 2007 this week, rattling Wall Street and pushing US mortgage rates past 7%. Bret Kenwell, US investment analyst at eToro, warned that rising yields, higher oil prices and the prospect of further Federal Reserve rate hikes are creating headwinds for stocks heading into the fourth quarter. Oil prices pulled back on Friday on hopes of a US-Iran deal to reopen the Strait of Hormuz, offering modest relief to markets. The FTSE 100 ended the week up 0.3%, while US indexes edged higher on Friday despite the bond turbulence.

Iran's foreign minister said the Strait of Hormuz could reopen within seven days 'if certain conditions are met', but analysts called the offer little more than a repackaged earlier deal.

US mortgage rates breached 7% this week as the bond sell-off drove borrowing costs higher across the economy, squeezing homeowners and businesses alike.

Kenwell cautioned investors against assuming a crash is inevitable, saying 'resilient earnings and a strong consumer have supported markets through similar stretches before'.