The reverberations emanating from rising U.S. Treasury yields over the past several weeks are shaking financial markets around the world.

Almost every government bond market – across both developed and emerging economies – is experiencing rising yields as U.S. Treasuries get cheaper, yield more, and thus become more attractive to global investors.

At the same time, fears that the Federal Reserve may begin to taper back monetary stimulus – which have been driving the rise in Treasury yields – are now seeping into equity markets as well, and stocks are selling off.

In a note to clients this afternoon, Miller Tabak Chief Economic Strategist Andrew Wilkinson asks, "Which domino are you watching?"

"There are simply too many (ugly) charts we could stick inside [of this note] and so we stopped short of doing so," says Wilkinson. "It is hard not to feel as though we are watching out for the lead domino to topple – the one that could set off a chain reaction."

Here's Wilkinson's take:

The pain continues across the Emerging Globe. Having fallen to a two-year low earlier in the week, Brazil’s benchmark Ibov index is lower again today. Mexico’s stocks slid by 2.00% in the face of rising volatility in US stocks. The CBOE Vix index is fast-approaching last week’s peak and the highest since mid-April.

And then there is the little matter of the yen, whose vacillations continue to trip-up US equity prices. As we noted late on Tuesday the Japanese unit was closing stronger than when it snapped the dollar’s grip last week. And more problematic was a broadening of the yen’s advance against the euro currency, British pound and the Aussie dollar. The dollar index just snapped to a two-month low midweek indicating a decidedly risk-off mood and one that hardly supports the earlier return for risk-appetite signaled by a move higher for equity prices.

Finally, the S&P 500 has slowly returned to beneath Friday’s low – the low supported by an above consensus payroll reading. Failure to hold that level could arguably cause stocks to have a stab at the fear-inspired lows of last week at 1598.

There are so many dominoes just waiting to topple that we’re no longer sure what to watch.

Wilkinson flags the unwind in the short-yen trade as a source of weakness in U.S. stock prices. Click here to read why the dollar-yen exchange rate has become so important >