Citi's Kaiser: Global bond yields are a risk that have been simmering in background for awhile

• Global bond yields, especially JGBs, are identified as the number one risk driving the market sell-off, with 30-year yields in major economies reaching historic highs.
• The current market correction is seen as a positioning sell-off, particularly in tech and Magnificent 7 stocks, rather than a broad market dislocation, with small caps and cyclicals performing relatively better.
• While the Yen carry trade unwinding hasn't fully activated as a risk, persistent increases in JGB yields could lead to more damaging and persistent market impacts.

The market sell-off is primarily attributed to rising global bond yields, particularly Japanese Government Bonds (JGBs), a risk that has been simmering for some time. While there's headline risk and positioning unwinding in tech, the speaker notes a lack of massive dislocations or extremely oversold assets, comparing the current situation to a brief tariff-induced pullback in October.