Stocks retreated Friday as a surge in the 10-year Treasury yield prompted broader concerns about the state of the economy.

The S&P 500 shed 1.26% to 4,224.16 and registered its first losing week in three. The Nasdaq Composite dropped 1.53% to 12,983.81. The Dow Jones Industrial Average lost 286.89 points, or 0.86%, to end at 33,127.28, dragged down in the session by American Express following a mixed earnings report.

The yield on the benchmark 10-year Treasury crossed 5% for the first time in 16 years on Thursday, a level that could ripple through the economy by raising rates on mortgages, credit cards, auto loans and more. Not to mention, it offers investors an attractive alternative to stocks.

The 10-year yield hit 5.001% around 5 p.m. ET Thursday, the first time it has traded above that level since July 2007. It retreated from that threshold through Friday.

“The stock market is watching the bond market and doesn’t like what it sees,” said David Donabedian, chief investment officer of CIBC Private Wealth Management. “Yields are rising, even with the relatively good news about inflation. This is the primary reason the stock market has been weak.”

The 30-year U.S. Treasury yield also hit a high last seen in July 2007. Meanwhile, the 30-year fixed mortgage rate reached 8% this week, a level not seen since 2000.

Regional banks tumbled as higher rates raised worries about the sector’s exposure to Treasury securities that are falling in value. Regions Financial led the decline after a weak earnings report, falling more than 12%. The SPDR S&P Regional Banking ETF (KRE) lost 4%.

American Express shares dipped more than 5%. The company’s earnings per share beat expectations, but revenue was about in line with estimates. Non-interest revenue, meanwhile, missed a StreetAccount consensus forecast.

Solar stocks were also among the biggest decliners. The move came after SolarEdge slashed its third-quarter revenue guidance, sending the stock down 27%. 

Concerns over higher rates weighed on the market during the week. The S&P 500 lost 2.4% on the week, while the Dow slipped 1.6%. The Nasdaq shed 3.2%, notching its second straight week of losses.

Nvidia, the closely followed artificial intelligence stock, was on pace for its worst week since September 2022 with a loss of nearly 9%. It was one of multiple semi stocks that struggled this week after the U.S. Department of Commerce announced plans to tighten restrictions on sales of advanced artificial intelligence chips to China.

Tesla ended the week more than 15% lower, its worst week since December 2022. The electric vehicle maker, which reported earnings on Wednesday, missed Wall Street expectations on both lines for the first time since 2019.