Bond Yields Hit 2008 Highs as Iran War and Salesforce Diverge

August ended with a bow, but the ribbon was on fire. All three major indexes posted monthly gains (the Nasdaq up nearly 4%), and yet Monday's session told a more uncomfortable story: the Dow dropped 374 points, the S&P fell 25, oil punched above $90 per barrel on Brent, and the 30-year Treasury yield hit its worst stretch since 2006. Bond investors, as Bloomberg put it, are in full revolt.

The culprit is familiar: Iran. The Strait of Hormuz remains closed until the U.S. meets interim deal conditions, the U.S. resumed missile strikes on Iranian rocket launchers for the first time in a month, and Trump is threatening to bomb Oman. The 10-year Treasury is sitting at 4.75%, the highest borrowing cost of the Trump presidency, while mortgage rates just hit 6.87%, their highest since June 2025. For context, when the Iran conflict started in late February, the 30-year fixed was 5.99%. That is an 88 basis point hit to every homebuyer in America in six months.

Meanwhile, $CRM is doing its best to ignore the macro chaos. Salesforce reported revenue up 11% year over year with accelerating growth and the stock trading at roughly 13 times near-term cash flow, a valuation that CNBC's Sarat Sethi called attractive in a market that has rotated back toward healthcare, staples, and software. That rotation is the signal worth watching: the previously unloved sectors are catching bids, which either means smart money is defensive or the AI trade is finally broadening. Sethi's read is that earnings have validated fair value, and now it comes down to stock selection rather than beta-chasing.

The bigger shadow over September is Tom Lee's revised playbook. Lee was bullish all August and was right, but on CNBC he flagged a potential 10% pullback as September crosscurrents converge, then partially walked it back, saying the Fed meeting on September 15th is the hinge. If the Fed holds rates steady, he sees a potential rally. If yields keep climbing, the bear case for a 10% correction shifts from September to October. His year-end S&P target remains 8,200 or higher, with 2027 EPS estimates now moving toward $425.

The FTC piling onto $AMZN for alleged advertising price manipulation, with 20-plus state AGs joining, is the kind of regulatory headline that hits on a bad tape and hits hard. Amazon fell nearly 3% on the news. It is not an existential threat to a company with AWS printing money, but it adds noise to an already noisy macro backdrop and gives short sellers a convenient hook.

The bond market is the tell. Stocks can pretend rates are not a problem right up until they suddenly cannot.