A hot economy and $100 oil are fanning fears about inflation. Strong growth, sticky inflation and a hawkish Fed are a near-perfect storm for higher Treasury yields. Business activity is rising at the fastest pace in more than five years, S&P Global’s purchasing managers index showed yesterday.

Fed Governor Michael Barr and the New York Fed’s John Williams said they’re still concerned about inflation, pointing to further interest rate hikes. The five-year Treasury auction had weak demand, pushing yields above 5% for the first time since 2007. The US 30-year yield hit 5.44%, the highest since 2004. The average yield on global government debt is now within a whisker of 4%.

The White House has trouble with energy into November’s midterm elections, but losing the Treasury market at the same time would be a bigger problem. After the selloff, the biggest risk for Treasury bonds into year end is a survey question in Markets Pulse.

Cybersecurity stocks have more than doubled since April as investors worry AI models could increase cyberattacks. Crowdstrike, Palo Alto Networks and Fortinet have all gained more than 130%, but they are among the market’s most expensive stocks.