U.S. stocks were negative Monday for the fifth straight day.

The 10-year Treasury yield initially spiked to 1.8 percent before dipping to 1.76 percent.

Technology names led the losses earlier in the day, coming under pressure as the sector with the most to lose in a rising-rate environment.

Oil is up to $78 a barrel, as expectations for increasing demand and still-slow output are priced in.

Along with technology shares, risk assets like Bitcoin, which was flirting with the $40,000 mark, were also sharply lower.

On the international front, European and Asian shares were mixed.

In a similar fashion to the same time last year, a rotation under the surface of the market is taking place. Investors are exiting growth stocks, such as technology, and rebalancing toward value shares, like large-cap bank stocks and those sensitive to economic activity, like energy, as rates rise.

Rising rates are a headwind for high-multiple, low-profit companies as the cost of borrowing and the discount rate increases, reducing present values. The banking sector, on the other hand, generally has lower multiples and does well with higher rates, as it contributes to wider margins in the industry.

Investors are grappling with three factors: a Federal Reserve bank that seems to have more appetite for restrictive monetary policy; higher and more persistent inflation than originally expected; and a new Omicron variant that is threatening to hamper the global economic rebounding many were forecasting.

High inflation and low real growth globally is a “nightmare” scenario that central banks and governments will struggle to deal with. Supply-chain disruptions and material shortages have proved long-lasting and are major drivers of inflationary pressures.

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