Broad stocks, bonds and real estate weakened in September, while energy-heavy commodities and the Nasdaq-100 gained. Higher yields help explain the divide, but October's returns remain uncertain.
On Sept. 29, the S&P 500, Dow and Nasdaq Composite all closed lower. The S&P 500 fell 0.17% to 7,670.84, the Dow lost 0.26% to 51,349.92 and the Nasdaq Composite slipped 0.08% to 26,797.54, according to a Reuters market recap. Those late-month figures capture only part of September's uneven performance.
Rising yields weighed on bonds and real estate. An energy-heavy commodity fund and the Nasdaq-100 moved higher instead. A broad market label can hide sharply different results.
Higher borrowing costs reach beyond investment accounts. They can make mortgages and real estate companies' financing more expensive. Stronger yields can also weigh on assets such as gold, which pays no interest. The effects reach further.
The 10-year U.S. Treasury yield rose 53 basis points in September, its largest monthly increase since September 2022, Reuters reported.
Yields hit bonds and property
Nearly every major asset class tracked in the review lost ground. The S&P 500 slipped 0.3% in September. The Vanguard Morningstar Total Stock Market ETF, a measure of the broader U.S. stock market, fell 0.8%. Foreign stocks declined in both developed and emerging markets. Bonds across categories fell as global yields climbed.
Real estate took the sharpest hit among the figures provided. The Vanguard Real Estate Index Fund ETF lost 6.2%, its worst monthly showing in almost two years. Higher rates can raise borrowing costs for real estate investment trusts, or REITs, and push mortgage rates higher. Both pressures can weigh on property businesses and the housing market.
CNBC reported on Sept. 28 that rising 10-year Treasury yields affect borrowing costs beyond the stock market, including mortgages, auto loans and credit cards. The yield serves as a benchmark for financing costs across the economy.
That link is not automatic. But a rise in yields can affect several parts of a portfolio at once. Bond prices face pressure, while property companies and homebuyers may have to pay more to borrow. A related yield analysis examined how higher Treasury yields can reach stocks, mortgages and the wider economy.
Official Treasury data put the 10-year yield at about 5.29% and the 30-year yield at about 5.64% on Sept. 30. The figures appear in the Treasury's daily yield table.
Oil and technology diverged
Commodities gained 4.5%, based on the iShares S&P GSCI Commodity-Indexed Trust. The fund tracks an index heavily concentrated in energy. Crude oil rose 8.9% amid the ongoing conflict in the Persian Gulf, while Brent crude traded around $101 a barrel.
On Sept. 28, Reuters reported that rising Brent and WTI prices amid concerns about conflict in the Middle East added to inflation worries and pressure on bonds and stocks. Gold moved the other way. It fell 6.8% as a stronger dollar and higher bond yields reduced its appeal.
Cash equivalents also gained. The iShares 0-1 Year Treasury Bond ETF holds U.S. Treasury securities with maturities of a year or less and is a low-risk cash equivalent. Its performance contrasts with declines in longer or broader bond categories. The source material provides no specific return for the fund. Not every bond fund fell.
Technology-heavy shares offered another counterpoint. The Nasdaq-100 rose 3.3% in September. Meta Platforms, Dell Technologies and Advanced Micro Devices each gained more than 20%. For 2026 to date, the index was up almost 21%, compared with a 12.7% gain for the S&P 500.
Those figures cover different index compositions and a period through September. They do not show that technology stocks will keep leading. That is no forecast.
Rates shape October risks
The forces behind September's split have not clearly gone away. The Persian Gulf conflict appears unlikely to be resolved soon. Bond yields remain elevated, and the Federal Reserve appears to be on a path toward higher interest rates, according to the original analysis. These conditions could extend pressure on rate-sensitive assets. They do not settle October's returns.
September's results argue against treating "the market" as a single trade. Broad U.S. stocks, large technology companies, bonds, real estate, commodities and cash equivalents responded differently to the same rate environment. The practical question is whether a portfolio's exposure fits its time horizon and tolerance for losses, not whether one asset class won a single month.
Bond yields and prices generally move in opposite directions. When market yields rise, existing bonds with lower coupon payments tend to become less attractive, putting pressure on their prices. Higher yields can also make income-producing alternatives more competitive with gold, which pays no interest. They can raise financing costs for property owners and REITs, too.
Short-term Treasury funds can behave differently from longer-duration bond funds because their holdings mature sooner. They are still investments, not bank deposits. September's divergence points to one risk to watch: elevated yields. A strong month for commodities or technology does not prove the broader market is protected from that pressure.
