The Dow closed lower by 817 points, or 1.91%. The broader S&P 500 slid 1.61% and the tech-heavy Nasdaq Composite fell 1.41%. The three major indexes each posted their worst day in one month.

The bond market has a sleepy reputation, but it can pack a punch when alarmed. And worries are now growing about tax cuts pushed by Washington and how they'll inflate the U.S. government's debt.