Big Tech Weighs on Stocks as Treasury Yields Climb: Markets Wrap

A renewed slide in tech megacaps pushed the stock market lower, with traders also wading through mixed economic data for clues on outlook for Federal Reserve policy. Bond yields climbed.

(Bloomberg) — A renewed slide in tech megacaps pushed the stock market lower, with traders also wading through mixed economic data for clues on outlook for Federal Reserve policy. Bond yields climbed.

The Nasdaq 100 underperformed major equity benchmarks and headed toward its longest weekly losing streak this year. Tesla Inc. dropped 2% while Nvidia Corp. — which has more than tripled in 2023 — extended a four-day slump to 10%. The S&P 500 fell in a thin trading session, with volume 20% below the average of the past month. 

There’s little question the stock market has lost a lot of its upside momentum, according to Matt Maley, chief market strategist at Miller Tabak + Co.

“As we move closer to the usually volatile September/October timeframe, it does seem like the ‘dippers’ are losing some of their strength,” Maley noted. “This does not mean that the stock market will roll over in a serious manner over the next month or two, but it does raise the odds of a correction in the not-too-distant future.”

Friday’s economic reports did little to alter bets the Fed will pause its rate hikes next month, but refrain from claiming victory over inflation.

Americans expect prices will climb at a 3.3% rate over the next year, down from the 3.4% expected in July, according to a reading from the University of Michigan. They see costs rising 2.9% over the next five to 10 years, compared to last month’s 3%. Separate data showed the producer price index picked up in July, primarily due to increases in certain service categories.

“With U-Mich in hand, there is little else on the docket today that will challenge the prevailing trend,” wrote Ian Lyngen, head of US rates strategy at BMO Capital Markets. “Suffice it to say, mid-summer Friday afternoons are notoriously choppy times in the US rates market and, as a result, we’ll be cautious of fighting any moves ahead of the weekend.”

Treasuries are on course for a record year of inflows as investors chasing some of the highest yields in months pile into cash and bonds, according to Bank of America Corp. strategists led by Michael Hartnett. 

Cash funds attracted $20.5 billion and investors poured $6.9 billion into bonds in the week through August 9, they wrote in a note, citing data from EPFR Global. Meanwhile, US stocks had their first outflow in three weeks at $1.6 billion.

Early this month, a key market indicator that has been called the “most important number in finance” plunged to its lowest since 2004, worrying investors that it was sending a bearish signal. Yet, history shows that despite the extreme move, the typically ominous sign is instead pointing to more gains. 

The equity risk premium measures the difference between the earnings yield on the S&P 500 and the current yield on 10-year Treasury notes. The higher the risk premium, the more attractive stocks are relative to bonds. That measure, which has been on a sharp downward trajectory for the most part of this year, just dropped to its lowest in about 20 years, indicating stocks are getting significantly overvalued as compared with bonds.

Elsewhere, UK bond yields climbed on data showing the British economy delivered its strongest quarterly growth in more than a year, a surprising show of resilience that will keep pressure on the Bank of England to raise rates further.

Some of the main moves in markets:


  • The S&P 500 fell 0.3% as of 11:49 a.m. New York time
  • The Nasdaq 100 fell 1%
  • The Dow Jones Industrial Average rose 0.2%
  • The Stoxx Europe 600 fell 1.1%
  • The MSCI World index fell 0.7%


  • The Bloomberg Dollar Spot Index rose 0.1%
  • The euro fell 0.3% to $1.0952
  • The British pound was little changed at $1.2687
  • The Japanese yen fell 0.1% to 144.96 per dollar


  • Bitcoin fell 0.3% to $29,338.49
  • Ether fell 0.3% to $1,843.28


  • The yield on 10-year Treasuries advanced five basis points to 4.15%
  • Germany’s 10-year yield advanced 10 basis points to 2.63%
  • Britain’s 10-year yield advanced 17 basis points to 4.53%


  • West Texas Intermediate crude rose 0.5% to $83.26 a barrel
  • Gold futures fell 0.2% to $1,945.50 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Rob Verdonck, Richard Henderson, Alex Nicholson and Cecile Gutscher.

More stories like this are available on

©2023 Bloomberg L.P.