U.S. stocks slip as investors await AI earnings and Fed speech
The S&P 500 fell 0.3% on Monday while bond yields eased slightly, as markets brace for Nvidia's earnings and a Federal Reserve speech later in the week.
U.S. equities edged lower on Monday, with the S&P 500 down 0.3% and the Nasdaq falling 0.6%, as investors looked ahead to a week of potentially market-moving events. The Dow Jones Industrial Average rose 0.1%, offsetting some of the broader decline.
Technology shares led the sell-off, driven by concerns that the rapid rise in artificial-intelligence stocks may be unsustainable. Nvidia, the sector's largest weight, dropped 2.3% ahead of its quarterly earnings report scheduled for Wednesday, while Micron Technology fell 6% and Broadcom slipped 2%.
Long-term Treasury yields, which have risen over the summer on inflation and debt worries, eased modestly on Monday, with the 10-year rate slipping to 4.70% from 4.74% on Friday. The decline was aided by a 2.3% fall in Brent crude to $90.55 a barrel.
The Treasury Department recently announced a modest increase in planned Treasury buybacks, a move analysts say may have limited impact on the underlying debt and inflation pressures. They caution that such interventions do not address the broader fiscal and energy-price challenges.
Federal Reserve Chairman Kevin Warsh is slated to speak at the Jackson Hole symposium on Friday. Economists expect him to address inflation and the Fed’s potential policy response, noting that any deviation from market expectations could trigger further movements in bond yields.
International markets also moved lower, with South Korea’s Kospi down 3.1% and Hong Kong’s Hang Seng falling 1.9%, reflecting the global reach of the AI-related equity swing.