CNBC Daily Open: It's hard to imagine a 'Trump put' for a deficit-induced U.S. market sell-off
May 22, 2025 - cnbc.com
U.S. markets experienced a significant sell-off due to concerns over the country's fiscal health, exacerbated by President Donald Trump's tax bill, which could add $3 to $5 trillion to the national debt. This has led to a spike in Treasury yields, with the 30-year yield reaching 5.085% and the 10-year yield at 4.607%, the highest since February. The S&P 500, Dow Jones, and Nasdaq all saw declines, while Moody's downgraded the U.S. credit rating, further fueling market instability. In contrast, Bitcoin reached a new high of $109,857, and OpenAI acquired Jony Ive's AI devices startup io for $6.4 billion, marking its entry into the hardware sector.
Emerging markets are gaining attention as the "sell U.S." narrative strengthens, driven by the U.S. credit rating downgrade and a weaker dollar. Bank of America and JPMorgan have upgraded their outlook on emerging market equities, citing factors like U.S.-China trade tensions easing and attractive valuations. Meanwhile, Hinge Health priced its IPO at $32 per share, valuing the company at $2.6 billion, and Etihad Airways expressed confidence in Boeing despite delivery delays.
Key takeaways:
U.S. markets experienced a sell-off due to concerns over the country's fiscal health, with significant drops in major indices and a spike in Treasury yields.
The U.S. debt situation is worsening, with potential for further deficit increases if President Trump's spending bill passes, leading to a credit rating downgrade by Moody's.
Bitcoin reached a new high of $109,857, surpassing its previous record from January.
OpenAI acquired Jony Ive's AI devices startup io for $6.4 billion, marking its entry into the hardware sector.
