This week, rising bond yields and oil prices put stocks under pressure, while another bout of volatility in the AI trade tested investors' conviction in the market's biggest growth theme. The S&P 500 and tech-heavy Nasdaq Composite snapped their three-week winning streaks, down roughly 1.43% and 2.05%, respectively. Meanwhile, the Dow Jones Industrial Average slipped 0.85%.
Much of the pressure came from the bond market, where long-term yields surged to levels not seen in nearly two decades as tensions with Iran pushed oil prices higher and revived concerns about persistent inflation.
The Treasury Department stepped in Wednesday morning with an unusual announcement, saying it would more than double the size of its buybacks of longer-dated government debt. Yields initially fell and stocks rallied on the disclosure, which Jim characterized as an effort to preserve the stock market rally.
But the relief proved short-lived, with yields climbing again Thursday and Friday as higher oil prices kept inflation worries alive. The AI trade also had a rocky week, and a series of headlines on political backlash to data centers may have played a role.
To take a closer look at what drove the market this week, we are examining Broadcom's competition and a new name we are considering.
