Technology stocks fell sharply as U.S. Treasury yields climbed to their highest levels in nearly two decades, with the 30-year yield reaching 5.3% and the 10-year hitting 4.75%, according to market data verified across multiple outlets.
The semiconductor sector bore the brunt of the selloff. The Philadelphia Semiconductor Index dropped 5.4%, with Advanced Micro Devices falling 5%, Broadcom down 3%, and Nvidia declining 2%. Meta Platforms also fell 3% as investors rotated out of growth-sensitive equities in response to higher discount rates on future earnings.
Fiscal and inflation pressures drove the bond rout. July's federal deficit reached its highest level since March 2021, according to Treasury data, while inflation remains above the Federal Reserve's 2% target. Geopolitical risk added to the pressure: Middle East tensions lifted crude oil prices, raising expectations for sustained inflation in energy-dependent sectors.
Higher yields make future corporate profits worth less in present-value terms, a dynamic that hits technology and growth stocks hardest. Companies with revenues weighted toward years ahead face steeper discount rates. The 30-year yield's climb to 5.3% marks a level not seen since 2007, before the financial crisis.
The 10-year yield at 4.75% stands at its highest since June 2025, a jump of roughly 190 basis points from the 2.85% level at the start of 2024. That span captures the sharp redeployment of capital from equities into fixed income as long-term rates have reset higher.
Treasury yields and tech stock weakness have moved in lockstep throughout 2026 as the bond market repriced expectations for the path of U.S. interest rates and fiscal sustainability. The question now is whether yields have found equilibrium or whether further deficit data or inflation surprises could push them higher still.
