Stock markets mostly fell and oil prices climbed on Thursday as US Treasury bond yields hit multi-year highs, driven partly by a lack of progress in ending the Middle East war. After a down day in Europe, Wall Street stocks began the session firmly in negative territory, but received a positive jolt around midday with a Reuters news agency report that Washington and Tehran had made headway on an accord to reopen the Strait of Hormuz. "It felt like that lasted for an hour-and-a-half," said B Riley Wealth Management's Art Hogan, adding that markets need greater evidence of concrete movement towards a deal. Stocks levelled off after the positive jump. The S&P 500 declined 0.02 percent to end the session at 7,704 points. The Nasdaq edged up 0.01 percent to 26,939 points, while the Dow Jones Industrial Average declined 0.3 percent to 51,349 points. But the benchmark US 10-year Treasury yield rose to its highest level since 2007, and the 30-year yield reached its highest since 2004 as oil prices jumped. Japan's 10-year yield jumped to a 30-year high during Asia trading hours. "It is rare to get movements this volatile in sovereign bond markets, which is another sign that sovereign debt is going through an uncomfortable adjustment period," said Kathleen Brooks, research director at XTB. She pointed to a combination of rising governing debt loads and deficits, resilient economic growth and rising inflation risks. "These things together are anathema to the bond market and it is no surprise that yields are rising," she said. The rise in US yields also reflects solid economic data and rising expectations for additional tightening of monetary policy. Futures markets are betting with around 70 percent odds that the US Federal Reserve will increase interest rates in October. Such expectations drove 30-year US fixed-rate mortgages to more than 7.0 percent, a drag on consumers hoping to buy homes. Investors were also keeping an eye on the meeting between US President Donald Trump and President Xi Jinping at the White House. Few breakthroughs are expected during Xi's state visit. Instead the trip is more about the spectacle as the world's two biggest economies seek to manage points of friction. (AFP) Edited by Cecil Wong