Rising Yields Pressuring Tech Stocks
Continued selling in tech stocks may depend on central bank responses to rising bond yields.
Too little corroboration in the last 3 days to call a trend (16 articles). Watching for it to gain traction.
Mainstream financial press is carrying this — attention has broadened beyond specialist outlets.
"Wall Street is coming off a weak session in which rising Treasury yields renewed pressure on equities, particularly capital-intensive technology and artificial intelligence stocks."
"From July 17 to August 17 the 2-year barely moved, 4.18% to 4.19%, while the 30-year went up 25 bp to 5.31%. That gap ain't bullish for risk equities."
"September Nasdaq 100 E-Mini futures (NQU26) are down -1.21% this morning as a global bond rout sapped investors' appetite for risk, triggering a selloff in chip and other AI-related stocks. Chip and AI infrastructure stocks bore the brunt of the selling in pre-market trading."
"Stock Market Today: Tech Futures Slide As Treasury Yields Jump; Nvidia, Micron, Sandisk Sell Off"
"Higher real yields can put pressure on technology stocks and other long-duration assets by raising financing costs and reducing the relative appeal of future earnings. The issue is particularly important for AI-related companies and major cloud providers, whose shares have been among the strongest drivers of the market's gains this year."
"That uncertainty has kept markets closely focused on real Treasury yields - returns adjusted for inflation - a key driver of asset prices. Rising yields can pressure technology stocks and other long-duration assets by increasing financing costs."
"US chip stocks were weak on Friday on poor momentum and higher T-note yields, with the iShares Semiconductor ETF closing the day lower. Applied Materials (AMAT) delivered above-consensus guidance but nevertheless fell more than -5% after failing to exceed high AI expectations."
"Concerns over persistently high inflation have been simmering, compounded by a recent rise in Treasury yields. While semiconductor stocks have been a leading force in the market's ascent, the sector remains sensitive to inflation data and interest rate considerations."
"Higher rates particularly hurt stocks seen as the most expensive, and scrutiny has already been rising on makers of computer chips and other winners of the frenzy around artificial-intelligence technology. The 10-year Treasury yield jumped to 4.68% from 4.61% late Tuesday, up from 3.97% before the war with Iran sent oil prices much higher."
"This is a level that tends to attract funds away from equities and toward fixed income, while lifting the valuation bar for future corporate earnings. The shift has come just as investors question sky-high valuations for chip and AI stocks, which saw the Philadelphia Semiconductor Index shed 10% last week to leave it 20% down from June's record high."