Wall Street holds firmer after its three-week slide as Big Tech stocks rebound

A trader works on the floor at the New York Stock Exchange
Besides worries about the tightening grip from the bond market, concerns about a faltering economic recovery in China have also caused markets worldwide to sway this month.
(Seth Wenig / Associated Press)
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Wall Street held a bit firmer Monday following a painful three-week losing streak.

The Standard & Poor’s 500 rose 30.06, or 0.7%, to 4,399.77 for its first gain in five days. Rallies for Nvidia, Microsoft and other Big Tech stocks lifted the index even though the majority of stocks within it fell.

The Dow Jones industrial average slipped 36.97 points, or 0.1%, to 34,463.69, and the Nasdaq composite climbed 206.81, or 1.6%, to 13,497.59.

It was a return to form for Nvidia, Tesla and other market behemoths, which have struggled recently under the weight of rising yields in the bond market. The yield on the 10-year Treasury rose again Monday to touch its highest level since 2007 after briefly climbing above 4.34%. That’s up from 4.25% late Friday and from less than 0.60% in 2020.


Higher yields are good for people buying bonds, who get paid more in interest for their investments. But it also makes investors less willing to pay high prices for stocks and other investments that are less steady.

A swift rise for yields globally has shaken stock markets worldwide. It’s added to concerns that stock prices overshot during their strong run earlier this year and that signals keep showing China’s economic recovery is faltering.

Social media is full of scammers promising guaranteed returns on investment, and consumers lost $3.8 billion to them last year just in the U.S., the FTC said.

Aug. 19, 2023

Powell at Jackson Hole

The week’s main economic event is likely to be a speech Friday by Federal Reserve Chair Jerome Powell. The Jackson Hole, Wyo., setting for the speech has been the site of major policy announcements in the past by the Fed, and it’s one of the most important events each year for central bankers globally.

The worry is that Powell will dash investors’ hopes that the Fed has already hiked interest rates for the final time and that its next move is to cut rates early next year.

The Fed has already pulled its main interest rate to its highest level since 2001 in its effort to grind down high inflation. High rates do that by slowing the entire economy bluntly and hurting prices for investments.

Mortgage interest rates surpassed 7% this week, dealing another blow to potential homeowners who now face the highest borrowing costs since 2002.

Aug. 17, 2023

For all the anticipation about Powell’s speech, he may not end up sending a strong signal out of Jackson Hole, according to Goldman Sachs.


In the minutes from its last policy meeting in July, the Fed indicated it was unsure about its next move. It said that it will make its upcoming decisions on rates based on what incoming data say about inflation and the economy.

A big report on each of those topics is due the week after Powell’s speech. One is the latest monthly update on the Fed’s preferred way of measuring inflation, and the other is the monthly jobs report. “The Fed will likely wait to be informed by these new data before changing their current posture,” Goldman Sachs’ Lexi Kanter and Michael Cahill wrote in a report.

Economists at Bank of America, meanwhile, say there’s a chance Powell will say that every upcoming meeting of the Fed has a possibility to see a hike in interest rates given how strong recent economic reports have been.

“We think Powell’s tone at Jackson Hole will be less balanced than the July FOMC minutes,” they wrote in a BofA Global Research report.

The economy has remained remarkably resilient despite much higher interest rates. While that eases long-held worries about a possible recession, it could also add upward pressure on inflation.

Americans increased their purchases at retailers last month in a sign that solid consumer spending is still powering a resilient U.S. economy.

Aug. 15, 2023

Nvidia stock

Another big event for the market will be Nvidia’s profit report scheduled for Wednesday. The chip maker’s stock has flown higher this year, more than tripling on excitement about tremendous demand because of artificial-intelligence technology.


Nvidia’s report Wednesday may offer a hint about whether all the furor was deserved. It jumped 8.5% Monday. Microsoft, another AI winner, rose 1.7%. They were two of the strongest forces lifting the S&P 500.

Along with them was Tesla, another high-growth stock that’s been hurt recently by the threat of higher rates. It rose 7.3% to recover some of its 11% loss from last week.

Security software maker Palo Alto Networks jumped 14.8% for the biggest gain in the S&P 500 after reporting better profit for the spring than analysts expected.

On the losing end of Wall Street was Nikola, which has recalled more than 200 electric trucks following a couple of battery fires. It said it can’t guarantee when it will resume selling the trucks and that it will raise $325 million by selling convertible bonds. Nikola’s stock fell 23%.

Besides the possibility of higher rates for longer, concerns about China’s economic recovery have also weighed on markets globally.

Hong Kong’s Hang Seng tumbled 1.8% more Monday and is down 12.2% for August so far alone. Stocks also fell 1.2% in Shanghai. China cut a bank lending rate, but the move fell short of what some analysts expected.


AP writers Matt Ott and Joe McDonald contributed to this report.