US stocks slump, Dow Jones drops over 500 points

US stock indices fell sharply in early trading on Tuesday, after the Treasury bond yield rallied.

The markets are parsing the recent Federal Reserve officials statements, in which they hinted at sooner-than-expected rate hikes, which affects the dollar, and in turn, commodities and stocks.

The Federal Reserve will hold its first monetary policy meeting in 2022 next week, but analysts expect that the Fed will keep interest rates unchanged this time, and will start to raise it most likely during the March meeting.

US 10-year treasury yields rose to 1.8%, and the 2-year bond yield breached the 1% barrier.

As for stocks, Dow Jones fell 1.5% or 560 points to 35,346 as of 14:58 GMT, and S&P 500 fell 1.5% or 71 points to 4,591, while Nasdaq fell 1.7% or 255 points to 14,640 points.