New Delhi, Oct. 2 -- Risks to US equities are likely to increase as the bond market comes under further pressure, with rising Treasury yields beginning to spill over into credit markets, Jefferies said in its latest Greed & Fear report.

The brokerage said the US 10-year and 30-year Treasury yields, at 5.34 per cent and 5.69 per cent, respectively, had reached their highest levels that week since April 2002 and May 2002, respectively. The sharp rise in yields is becoming increasingly important for equities, particularly amid the emergence of a more hawkish Federal Reserve.

Jefferies said the two-year Treasury bond yield had reached a peak of 4.96 per cent that week, or 108 basis points above the midpoint of the federal funds rate, which ...