Major stock indexes are trading near record highs. Yet the rally shows signs of strain beneath the surface.
Elevated oil prices are pressuring sectors tied to energy and transportation. Rising Treasury yields are making bonds more attractive than stocks.
The Federal Reserve is preparing for additional interest-rate hikes. Investors are weighing how aggressive the central bank will be.
Higher rates raise borrowing costs for companies and consumers. That can slow spending and weigh on corporate profits.
Oil prices remain above comfortable levels for many economies. Persistent energy costs can feed inflation and squeeze margins.
Treasury yields have climbed as bond markets price in tighter policy. When yields rise, equity valuations often face downward pressure.
The combination creates a fragile backdrop for the market. Record index levels may not reflect the stress building underneath.
