Here we go again: Worries about the bond market are driving heavy selling on Wall Street.

The Dow declined about 400 points, or 1.7%, on Thursday. The S&P 500 and Nasdaq were also firmly in the red.

The market started the day just modestly lower, but selling picked up as the 10-year Treasury yield hit a four-year high of 2.88%, renewing concerns about inflation and higher interest rates.

“The bond market has definitely got the stock market’s attention,” said Ryan Detrick, senior market strategist at LPL Financial. “Is the bond market telling us something we don’t know? Is there more inflation down the road than we’re expecting?”

The latest round of selling knocked the Dow and S&P 500 back into the red for the year.

Wall Street is struggling to stage a lasting rebound from Monday, when fears about the bond market sent the Dow plunging a record 1,175 points.

Trading has been choppy, and the market has swung in wide ranges. The Dow surged 567 points on Tuesday, but a 381-point rally vanished on Wednesday after bond yields crept higher.

“Volatility shocks tend to take time to work off, so sharp moves intraday should still be expected,” analysts at Bespoke Investment Group wrote in a report on Thursday.

It’s a big shift from 2017 and the beginning of 2018, when the stock market went the longest period ever without tumbling. But such calm is unusual, and stocks overheated.

“We had an epic run. There was euphoria because there hadn’t been a pullback,” said Jeffrey Schulze, investment strategist at ClearBridge Investments.

Consider this: The S&P 500 has risen or fallen 1% five times in the past two weeks. That only happened eight times all of last year, the fewest since 1964, according to LPL.

“We’ve hit this incredible dose of volatility like nothing we’ve seen since Brexit,” Detrick said.

Related: Trump breaks his silence on market chaos

The yield on the 10-year Treasury bond ticked higher again on Thursday morning, to 2.88%. That’s a big spike from just 2.65% during the panic selling Monday afternoon.

The bull market has feasted on extremely low bond rates. The fear is that Treasury yields will rise to levels that make stocks less attractive and force the Federal Reserve to fight inflation by aggressively raising interest rates.

Washington is putting more pressure on rates. The U.S. Senate reached a bipartisan deal Wednesday that would boost spending limits by $300 billion over the next two years. The compromise, coupled with Republican tax cuts, could lift the federal budget deficit to $1.07 trillion in fiscal 2019, according to Bank of America estimates.

Wall Street anticipates that more government spending will force the Treasury Department to borrow more money by selling additional bonds. To drum up demand for that higher supply, rates mx`ay have to go up.

Bank of America analysts warned that the Senate agreement will contribute to “higher rates” and raise “risks for tighter overall financial conditions.”

These bond market worries briefly sent the Dow into a correction earlier this week, a 10% decline from recent highs. The fragile rebound lifted the market a bit, and the Dow and S&P 500 are now about 8% off their from all-time highs. Neither index has closed in a correction in two years.

The stock market is still up dramatically since President Trump’s election. His promises for big corporate tax cuts helped lift the Dow more than 8,000 points, though it has since given back about a fifth of that surge.

The market performance also reflects the strong U.S. and global economies, which have boosted corporate profits. The job market remains healthy, as evidenced by a report Thursday that applications for unemployment benefits are at a 45-year low.

“The U.S. economy is on solid foundation,” said ClearBridge’s Schulze.

The Dow Jones Industrial Average has yo-yoed from a historic loss on Monday to a 500-plus point gain on Tuesday.
The Dow Jones Industrial Average has yo-yoed from a historic loss on Monday to a 500-plus point gain on Tuesday.

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