By Caroline Valetkevitch and Johann M Cherian
Sept 29 (Reuters) - Bond yields extended their recent rise and major stock indexes eased on Tuesday, although technology shares gained amid optimism over AI lab Anthropic's plans for a public debut.
The yield on the 30-year US Treasury bond hit its highest level since June 2002.
Investors digested data that showed US consumer confidence dropped to the lowest level in more than 12 years in September, with households expecting both business conditions and
the labor market to weaken over the next six months.
But they eagerly await the monthly US personal consumption expenditures price index (PCE), due Wednesday.
"Some investors are preparing for... the PCE tomorrow. If we should see an acceleration of inflation, that will I think cement a rate hike in October and that is part of the fear in the bond market right now," said Peter Cardillo, chief market economist at Spartan Capital Securities in New York.
Bond yields have been rising in part because of higher oil prices tied to the seven-month-old war in the Middle East and worries about inflation. The Federal Reserve raised interest rates earlier this month for the first time since 2023. Investors see a near-70% chance for a 25-basis-point hike in October, the CME Group's FedWatch Tool showed.
The 30-year bond yield was last up 4.94 basis points at 5.6114% from 5.562% late on Monday, while the yield on benchmark US 10-year notes was up 4.28 bps at 5.285%, from 5.242% late on Monday.
Earlier, yields on French 10-year bonds were pinned near 2008 highs at 4.74% and were set for their biggest monthly rise since 2022.
Sovereign yields are an anchor for global markets, a reference price for investing in riskier stocks and a benchmark for mortgages and corporate borrowing. Higher rates pile pressure on government, corporate and household budgets.
The Dow Jones Industrial Average fell 316.58 points, or 0.61%, to 51,164.93, the S&P 500 fell 22.49 points, or 0.29%, to 7,661.20 and the Nasdaq Composite fell 36.19 points, or 0.13%, to 26,784.19.
The S&P 500 technology index was up 0.1%.
Anthropic's IPO prospectus showed how the AI lab has grown sharply in the last year but has also posted wider losses. The company is targeting a $2 trillion-plus valuation, possibly setting a benchmark for how Wall Street measures AI leaders.
Anthropic has also called for more AI regulation.
MSCI's gauge of stocks across the globe fell 4.57 points, or 0.40%, to 1,134.70.The pan-European STOXX 600 index was down 0.15%.
OIL FALLS
Oil prices fell as investors focused on signs of recovering crude exports from the Middle East and lingering concerns over potential supply disruptions in the region stemming from the US-Israeli war on Iran.
US President Donald Trump earlier said he has offered Iran nothing to end the war, rejecting media reports that he was willing to offer some relief from sanctions.
US crude fell 2.27% to $90.52 a barrel and Brent fell to $104.28 per barrel, down 0.95% on the day.
In currencies, the euro was down 0.34% at $1.1331. Against the Japanese yen, the dollar strengthened 0.11% to 157.53. The Australian dollar weakened 0.57% versus the greenback to $0.6975.
Earlier, Australia's central bank lifted rates to a 15-year high.
(Reporting by Caroline Valetkevitch in New York and Johann M Cherian in Bengaluru; additional reporting byTom Westbrook in Singapore; Editing by Stephen Coates, Thomas Derpinghaus, Andrew Heavens and Aurora Ellis)
