"It's a psychological level for the markets because we haven't seen 3 percent 10-year yields since 2013", said Brett Ryan, an economist with Deutsche Bank. Nickel and palladium (both of which Russian Federation produces a large share of global output) also fell more than 5%.
Asian stocks rose on Thursday as robust corporate earnings helped Wall Street quell concerns about the surge in USA bond yields, while the dollar hovered near 3-1/2-month highs against a basket of currencies.
"I don't think that the 3 percent level necessarily makes bonds a buy", said Alan Gayle, president of Via Nova Investment Management in Fredericksburg, Virginia. Brent crude, used to price worldwide oils, gained 46 cents to $75.17 per barrel in London.
Oil is at its highest since late 2014.
"If you believe that the Fed (Federal Reserve) will do what it has done for the last 30 to 40 years, then you will have to come to the conclusion that this will be positive for the dollar", he said, predicting that the US central bank would tighten policy further to curb inflation.
Traders were also getting a global round of economic surveys that should show if economic softness in the first quarter was just a passing phase linked to wintery weather and the Lunar New Year holidays. Upon joining OANDA in 2007, Alfonso Esparza established the MarketPulseFX blog and he has since written extensively about central banks and global economic and political trends.
On the geopolitical front, there was plenty to digest too.
US Treasury Secretary Steven Mnuchin had said on Saturday he may travel to China, a move that could ease tensions between the world's two largest economies.
On Wall Street, technology stocks.SPLRCT jumped 2.35 percent, led by a 9.73 percent jump in Facebook Inc (FB.O) and 4.694.62 percent rise in Visa (V.N) after their quarterly results.
ASIA'S DAY: Japan's benchmark Nikkei 225 rose 0.9 percent to finish at 22,278.12, helped by the weaker yen.
Meanwhile, analysts are gearing up for a deluge of major earnings reports. These include tech giants Amazon, Alphabet, Facebook, Microsoft, as well as Boeing and Chevron. The S&P 500 edged up 0.01% to 2670.29 while the Nasdaq Composite slipped 0.25% 7128.60. Of the 87 companies that have reported so far, 79.3 percent have topped profit expectations, according to Thomson Reuters I/B/E/S.
But higher yields on bonds make gold a less attractive investment because it pays no interest. It also came shortly before oil's 75 percent price tumble.
"Finally rising US yields are having at least some effect on the dollar".
"At least in the currency world, rising yields in the USA severely undermine the appeal of riskier assets, particularly higher-yielding and emerging market currencies", said Omer Esiner, chief market analyst at Commonwealth Foreign Exchange in Washington. The next key technical level for the 10-year yield is 3.05 percent, which would put the yield at its highest level since 2011.
The greenback rose strongly against the yen and euro. It also tells us that market fears may be contained, as investors are not buying up "safe haven" US Treasuries, which would send yields lower (coinciding with progress in lowering the tensions between the United States and North Korea). The euro fell to $1.2213 from $1.2233.