Bond Yields Enter Danger Zone as S&P 500 Shows Narrow Resilience

As of May 21, long-term U.S. Treasury yields have entered the 'danger zone' above 5%, with the 30-year yield near 5.14% and the 10-year at 4.64-4.67%, yet the S&P 500 has displayed only limited damage thanks to strong Q1 earnings. The surge began in early May when stronger data and hawkish signals lifted yields from 4.4% in a bear-steepening move, prompting Danske Bank and Deutsche Bank to warn of a broad risk-off environment hitting technology and real estate hardest. Three potential correction triggers—an oil shock, contractionary data, or aggressive Fed tightening—now threaten the prior Goldilocks pricing, though resilient corporate profits and steady rate expectations have so far cushioned the impact.