What Happened?
A number of stocks fell in the afternoon session after the 10-year Treasury yield jumped to 5.14%, reaching levels last seen in 2007 and raising borrowing costs across the economy. U.S. stocks fell early Thursday, according to the Associated Press, as surging Treasury yields and rebounding energy prices weighed on financial markets.
A Treasury yield is the return investors earn for lending money to the U.S. government. The 10-year yield is closely watched because it serves as a benchmark for many other borrowing costs, including mortgages and corporate loans. When it rises, it becomes more expensive for households and businesses to borrow, which can slow spending and investment. Higher yields can also make stocks look less attractive. When investors can earn a relatively safe return of more than 5% from government bonds, some may choose to move money out of riskier assets such as equities.
Companies that depend on borrowing to fund growth, or whose value is based heavily on expected future profits, often feel this pressure most. Rebounding energy prices added to the strain. Higher fuel costs can raise expenses for businesses and consumers and may keep inflation elevated, which could keep upward pressure on interest rates. Taken together, the jump in yields to their highest level in roughly two decades and the rise in energy prices created a difficult backdrop for stocks across the sector, with many companies moving lower together.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks.
Among others, the following stocks were impacted:
- Agricultural Machinery company AGCO (NYSE:AGCO) fell 3.8%. Is now the time to buy AGCO? Access our full analysis report here, it’s free.
- Specialty Equipment Distributors company Alta (NYSE:ALTG) fell 4.1%. Is now the time to buy Alta? Access our full analysis report here, it’s free.
- Agricultural Machinery company Alamo (NYSE:ALG) fell 4.5%. Is now the time to buy Alamo? Access our full analysis report here, it’s free.
- Electronic Components company Allient (NASDAQ:ALNT) fell 4.3%. Is now the time to buy Allient? Access our full analysis report here, it’s free.
- Engineered Components and Systems company Mayville Engineering (NYSE:MEC) fell 4.6%. Is now the time to buy Mayville Engineering? Access our full analysis report here, it’s free.
Zooming In On Mayville Engineering (MEC)
Mayville Engineering’s shares are very volatile and have had 28 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful but not something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 7 months ago when the stock dropped 9.2% on the news that the company reported disappointing fourth-quarter 2025 results that missed profit expectations and provided a weak forecast. While the company’s revenue of $134.3 million met Wall Street’s expectations, growing 10.7% year-over-year, investors focused on deteriorating profitability. Adjusted EBITDA for the quarter was $6.31 million, a significant 43.1% below analyst estimates.
Profit margins also contracted sharply, with the operating margin falling to negative 4.1% from a positive 19% in the same quarter last year. Looking ahead, the company’s guidance for the first quarter of 2026 and the full year also disappointed. Its revenue forecast for the upcoming quarter and its full-year EBITDA guidance both came in below analysts' projections.
Overall, the significant miss on current profitability combined with a weaker-than-expected outlook for the year ahead drove negative sentiment.
Mayville Engineering is down 11.2% since the beginning of the year, and at $16.82 per share, it is trading 55.2% below its 52-week high of $37.54 from June 2026. Investors who bought $1,000 worth of Mayville Engineering’s shares 5 years ago would now be looking at only $848.59.
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