Editor’s note: This story has been corrected to reflect that Fisker is reportedly considering bankruptcy, but has not filed for bankruptcy.

Traders received a cold shower on Thursday as hopes for a rate cut were dashed, with February’s Producer Price Index (PPI) inflation figure significantly exceeding expectations, adding to concerns raised by robust consumer inflation data earlier in the week.

During morning trading hours in New York, major U.S. equity indices turned negative, driven by a sharp increase in U.S. Treasury yields.

The 30-year Treasury note yields rose by 9 basis points to 4.44%, marking the highest level since late February. The iShares 20+ Year Treasury Bond ETF (NASDAQ:TLT), the world’s largest bond ETF, declined by 1.4%, poised for its sixth consecutive day of losses, marking the longest losing streak since last August.

Traders tempered their expectations for rate cuts, now anticipating only an 80-basis-point reduction by year-end, equating to just three cuts of 25 basis points each. Market-implied probabilities of a rate cut by June decreased from nearly 70% to 62%, according to the CME Group FedWatch tool.

While the S&P 500, Nasdaq 100 and Dow experienced relatively modest losses ranging between 0.3% and 0.4%, the CBOE Volatility Index, or VIX, surged by over 6%. In contrast, small caps, as tracked by the iShares Russell 2000 ETF (NYSE:IWM), underperformed large caps, declining by 1.7%.

Bitcoin fell by nearly 3% to $71,000, while gold slid by 0.8% to $2,160 per ounce. Oil prices surged, with West Texas Intermediate (WTI) rising by 2% to over $80, following a report from the International Energy Agency (IEA) indicating that oil markets are likely to face a supply deficit for the remainder of the year due to OPEC+ production cuts.

Thursday’s Performance In US Major Indices, ETFs

Sector-wise, the Energy Select Sector SPDR Fund (NYSE:XLE), was the only positive performer for the day, up by 1%. The Real Estate Sector SPDR Fund (NYSE:XLRE) was the laggard, down 2%.

Thursday’s Stock Movers

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