The S&P 500 slipped 0.3%, moving further from its all-time high set earlier in the month, while the Dow Jones Industrial Average rose 49 points, or 0.1%, by 9:35 a.m. Eastern time. The Nasdaq composite fell 0.6%.
Wall Street Drifts Ahead of Busy Week
Technology stocks led the downward movement amid summer swings driven by concerns that enthusiasm around artificial intelligence technology pushed prices too high. Nvidia, a major winner of the artificial intelligence boom, sank 2.3% and weighed heavily on the S&P 500. Other chipmakers also declined, with Micron Technology dropping 6% and Broadcom falling 2%. Nvidia is scheduled to release its latest quarterly earnings report on Wednesday, which could influence the trajectory of artificial-intelligence-related stocks.
Bond Yields Ease Following Treasury Move
Meanwhile, portions of the bond market that the U.S. Treasury Department has attempted to calm experienced some easing. The yield on the 10-year Treasury dropped to 4.70% from 4.74% late Friday. Longer-term Treasury yields had climbed through the summer due to concerns over high inflation, large government debts, and other factors, which pushed up mortgage rates and impacted the housing industry.
The Treasury Department announced a surprise plan last week to increase the size of planned buybacks for Treasurys to help contain rising yields for 10- and 30-year maturities. Analysts also warned that government efforts to push longer-term yields downward could ultimately increase pressure on inflation.
Global Markets and Federal Reserve Outlook
Global markets saw notable declines, with South Korea’s Kospi dropping 3.1% and Hong Kong’s Hang Seng falling 1.9%. Seoul experienced sharp summer swings due to its heavy reliance on tech giants Samsung Electronics and SK Hynix.
Persistent inflation continues to elevate pressure on the Federal Reserve to adjust the federal funds rate, which influences short-term overnight loans. Federal Reserve Chairman Kevin Warsh is scheduled to deliver a speech on Friday at an economic symposium in Jackson Hole, Wyoming.
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