Wall Street warns that US stocks may face "inflation repricing," as high oil prices and surging US Treasury yields increase market risks.

BlockBeats reported that on May 18, as the US stock market continued to remain at high levels, Wall Street institutions began warning that the market may be underestimating inflation and interest rate risks. Recently, the 30-year US Treasury yield broke above 5%, and the 10-year US Treasury yield rose above 4.5%, raising concerns that the valuation of risk assets may come under pressure.

According to analysts, since the escalation of the conflict between the US and Iran, international oil prices have consistently remained above $100 per barrel, and the potential for a prolonged blockage of the Strait of Hormuz is intensifying market worries about a new round of inflation. Capital Economics has warned that the market has not yet fully priced in the extreme scenario of a long-term closure of the Strait of Hormuz.

Although the AI investment boom and strong corporate earnings reports still support US stock market performance, some institutions believe that the current S&P 500 forward price-to-earnings ratio has reached 21.3 times, significantly higher than the long-term average. As the bond market takes the lead in repricing inflation, the stock market may face dual pressures from valuation and liquidity.