Weekly Market Wrap: Rising yields hit stocks as oil and gold extend their rally
US equities ended lower this week as rising Treasury yields and renewed inflation concerns finally interrupted the rally that had carried major indices to record highs.
The S&P 500 fell 1.4%, and the Nasdaq Composite dropped 2.1%, snapping three-week winning streaks. The immediate pressure came from the bond market, where the US 30-year Treasury yield briefly rose to its highest level since 2007 as investors weighed large government borrowing, higher oil prices and the risk that inflation could remain sticky.
Australian shares also lost ground. The ASX 200 fell around 0.7% for the week as technology, consumer discretionary and real estate stocks came under pressure, even as rising crude prices supported energy shares.
Gold and oil moved in the other direction. Gold rose more than 5% to a three-month high above US$4,600 an ounce as the US dollar weakened, while Brent crude added almost 6% on continued disruption risks around the Strait of Hormuz.
For Australian traders, the next test comes from local inflation data, a heavy ASX reporting week, Nvidia’s earnings, the Federal Reserve’s preferred inflation measure and Chair Kevin Warsh’s Jackson Hole speech.
The week in markets
| Market | Weekly Move / Signal | What Drove It |
|---|---|---|
| S&P 500 | -1.4% | Higher Treasury yields hit equity valuations |
| Nasdaq Composite | -2.1% | Technology shares led the weekly pullback |
| ASX 200 | -0.7% | Earnings pressure and weakness in rate-sensitive sectors |
| Brent crude | +5.8% | Iran sanctions risk and Hormuz disruption fears |
| Gold | +5.6% | A weaker US dollar and safe-haven demand |
| US 30-year Treasury yield | Hit 5.33% intraday | Fiscal, inflation and supply concerns lifted long-term rates |
Bond yields became the market’s main risk
The week began with investors still focused on the prospect of easier policy after softer US inflation data. That confidence faded as long-term Treasury yields resumed climbing.
The 30-year yield briefly reached 5.33%, its highest level in almost two decades, while the 10-year yield ended the week near 4.74%. Higher long-term yields raise the discount rate used to value future corporate earnings, which is why they can weigh particularly heavily on highly valued technology companies.
That was enough to pull the Nasdaq lower even as Friday’s bounce lifted major US indices. The move was not solely about interest rates. Rising oil prices added to inflation uncertainty, while strong US services data contrasted with weaker manufacturing activity affected by supply-chain disruption.
The immediate question is whether the sell-off was a healthy reset after the recent rally, or the start of a broader reassessment of how much higher yields global equities can absorb.
The ASX 200 faces its own inflation and earnings test
The ASX 200 fell around 0.7% for the week, underperforming the Friday rebound on Wall Street as investors worked through a heavy reporting season and the implications of higher oil prices.
The split across sectors was clear. Energy shares benefited from Brent’s move towards US$94 a barrel, while technology, consumer discretionary and real estate stocks came under pressure. Higher energy costs risk lifting inflation again, while weaker retail conditions and a softer jobs market have complicated the outlook for rate-sensitive companies.
Australian CPI is now the immediate domestic catalyst. A further easing in inflation would reinforce the case for the RBA to keep rates unchanged at its September meeting. A stronger result, particularly after oil’s latest surge, could revive rate concerns and pressure the parts of the ASX most sensitive to borrowing costs.
The coming earnings reports from Woodside, Ampol and Fortescue will also offer a more direct read on how the oil, iron ore and China-demand stories are flowing through to major Australian shares.
Oil and gold rallied for different reasons
Brent crude approached US$94 a barrel after gaining almost 6% for the week. The United States stepped up pressure on Iran, including threats of tougher sanctions, while concerns over oil flows through the Strait of Hormuz remained unresolved.
For oil traders, the risk remains two-sided:
Further disruption to shipping, exports or Iranian supply could push Brent higher and revive broader inflation concerns.
Evidence that tanker traffic is normalising, or a credible diplomatic breakthrough, could quickly remove some of the current supply premium.
A sustained oil rally would matter beyond energy markets because higher fuel costs may complicate the inflation outlook just as investors are looking for confirmation that price pressures are easing.
Gold reached a three-month high above US$4,600 an ounce, helped by a weaker US dollar and strong safe-haven demand. The metal also found support from concern that long-term US borrowing and political pressure on monetary policy could weaken confidence in the dollar.
That creates an unusual cross-market setup. Higher yields would normally challenge non-yielding gold, but gold has continued to attract buyers as investors look for protection from inflation, fiscal uncertainty and geopolitical risk.
Contracts for Difference (CFDs) allow traders to take a long view if supply concerns support Brent or safe-haven demand lifts gold, or a short view if tensions ease and the US dollar recovers. Stop-loss and take-profit orders can help define risk around fast-moving geopolitical headlines.
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Technology stocks now need Nvidia to deliver
The Nasdaq’s weekly decline put the AI trade back under pressure just days before Nvidia reports its quarterly results.
Nvidia remains the market’s most important test of AI infrastructure demand. Analysts expect quarterly revenue of around US$92 billion, with data-centre revenue forecast to account for more than US$85 billion. Those numbers underline the scale of demand already priced into the AI supply chain.
Investors will look beyond the headline result to several issues:
Whether demand for Blackwell and Vera Rubin systems continues to support revenue growth and margins.
Whether higher memory costs are beginning to affect the economics of AI servers.
Whether Nvidia’s large data-centre financing commitments prompt more concern about how AI infrastructure spending is being funded.
Whether guidance can justify valuations across the wider semiconductor, networking and data-centre supply chain.
A strong result could help the US Tech 100 recover from this week’s pullback. A cautious outlook, particularly alongside higher yields, could put renewed pressure on a sector that has carried much of the market’s gains this year.
Three markets to watch this week
ASX 200: Can local inflation and earnings steady the index?
The ASX 200 enters the week with energy shares supported by higher crude prices, but rate-sensitive sectors still exposed to the bond-market move. Australian CPI, RBA minutes and results from major energy, consumer and mining companies could determine whether the index finds support after this week’s pullback.
A softer inflation result and resilient earnings could improve sentiment towards banks, retailers and real estate stocks. Higher inflation or weaker guidance, particularly if oil keeps rising, could extend the divide between energy and the rest of the market.
US Tech 100: Can Nvidia restore confidence?
Nvidia’s earnings will set the tone for the AI trade, but the reaction will depend as much on guidance and margins as on reported revenue. A strong result and lower yields could support a recovery in the US Tech 100. Higher yields or any evidence that AI spending is becoming harder to finance could extend the pullback.
Brent crude: Can it break through US$95?
Brent is again close to a key psychological level. Traders will be watching sanctions developments, tanker traffic and any change in the US-Iran standoff. A move above recent highs would keep inflation concerns in focus; signs that supply risks are easing could produce a sharp reversal.
What is on the calendar?
The week ahead will test whether earnings can again offset concern about higher yields. For Australian markets, the outcome will also depend on whether local inflation continues to ease and whether reporting season can support confidence outside the energy sector.
Trade the markets that matter this week with Mitrade
This week’s market action showed why watching a single index is not enough. Rising yields pressured technology shares, oil supported Australian energy stocks, and gold gained as investors reassessed inflation, geopolitical risk and the outlook for the US dollar.
Mitrade gives traders access to global indices, commodities, forex and selected shares from one platform. CFDs can be used to take a long or short position depending on how the next catalyst develops, with stop-loss and take-profit orders available to help manage risk.
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1. Why did higher Treasury yields pressure US technology stocks?
Higher yields increase the discount rate investors use to value future profits. That tends to weigh more heavily on technology companies because much of their valuation depends on expected earnings growth further into the future.
2. Why is Australian CPI important for the ASX 200?
Inflation data can influence expectations for the RBA’s next rate decision. Softer inflation may support rate-sensitive sectors such as banks, retailers and real estate, while a stronger result could renew concern that interest rates need to remain higher for longer.
3. Why can gold rise while US Treasury yields are higher?
Higher yields can normally make gold less attractive because the metal does not generate income. This week, however, gold benefited from a weaker US dollar, safe-haven demand, and concern over inflation, fiscal borrowing, and geopolitical risk.
Disclaimer: The content presented above, whether from a third party or not, is considered as general advice only. CFD trading involves significant risk of loss. Past performance does not guarantee future results. This article serves informational purposes only and does not constitute financial advice. Consider your risk tolerance before trading.
