US stock markets opened lower on August 20 as a brief reprieve in the bond market evaporated overnight, dragging equity indices back into the red. The Dow Jones Industrial Average, S&P 500, and Nasdaq all declined at the open, reversing gains from the previous session that had been fueled by Treasury Secretary Scott Bessent’s announcement of expanded buyback operations.
What happened with the buybacks
Bessent framed the move as providing “greater liquidity support” in longer-dated sectors of the Treasury market. The initial market reaction was exactly what you’d want if you were the Treasury Secretary: the 30-year yield dropped over 10 basis points to around 5.184%, pulling back from a 19-year high above 5.33%.
Stocks responded in kind on August 19. The S&P 500 closed up 0.21% at 7,707.98, while the Dow added 119.65 points.
By the morning of August 20, Treasury yields had begun climbing again, putting renewed pressure on equities.
