Treasury yields rose sharply overnight as investors reacted to early election results showing former President Donald Trump gaining an edge over Vice President Kamala Harris.

The 10-year Treasury yield jumped to 4.431%, its highest since July, while the 2-year yield rose to 4.285%.

Traders speculated that a potential Trump win, especially with a Republican sweep, could drive yields higher due to expectations of tax cuts and fiscal expansion, CNBC has reported.

Wall Street anticipates bond market volatility depending on the election outcome, with yields possibly reaching 4.5% if Trump wins, or falling to 4% if Harris prevails.

Written by B.C. Begley