U.S. stocks fell Tuesday as a worldwide bond selloff pushed long-term yields to their highest levels in years. Chip stocks came under heavy pressure and the expiration of a U.S.-Iran ceasefire rekindled fears of renewed Middle East escalation.

The Dow Jones Industrial Average fell 116.38 points, or 0.22%, to 53343.40. The S&P 500 lost 53.30 points, or 0.69%, to 7691.76, while the Nasdaq Composite declined 355.20 points, or 1.33%, to 26289.71. According to preliminary data, there were 945 advancing issues and 1779 declining issues on the NYSE.

The 30-year Treasury yield hit its highest level since 2007 early Tuesday. The bond selloff, analysts said, reflects a confluence of forces: inflation fears stoked by rising energy prices, growing government deficits and the AI industry's voracious appetite for debt. "The change this year has been the scale and maturity of AI-related corporate borrowing," Barclays said in a research note.

Big technology companies have been issuing vast quantities of long-dated bonds to fund data centers and chip purchases, putting them in direct competition with government borrowers for investor dollars. German and French long-dated yields hit their highest closing levels since 2011 and 2008 respectively, while Japanese yields approached all-time highs as Prime Minister Sanae Takaichi has abandoned years of fiscal restraint.