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August 24, 2026 - 21:34
5 minutes
(Bloomberg) — Wall Street kicked off the week on a cautious note, with a selloff in chipmakers outweighing an oil drop as traders parsed Treasury Secretary Scott Bessent’s plan to isolate Iran from the global economy.Just days ahead of Nvidia Corp.’s earnings, semiconductor giants slipped. While the results may serve as a reminder of the firm’s commanding lead, some of its big customers have been notified about artificial intelligence-related price hikes above 15%. A $26 billion ETF tracking memory shares sank 5.5%. The Nasdaq 100 lost 0.8%. Oil settled at $85, lifting bonds.The Treasury chief threatened economic punishment against any country doing business with Iran as part of an “economic D-Day” campaign to isolate the country and end nearly six months of war.Having recently surprised the market with a plan to boost buybacks of longer-dated bonds, Bessent also refrained from any further signals on revamping US debt management. That was after a report that his department could draw down some of its cash pile to fund buybacks of higher-yielding older securities.“Details about US economic sanctions on Iran, the Treasury’s attempts to lower long-term yields, and economic data may shape much of the sentiment backdrop,” said Chris Larkin at E*Trade from Morgan Stanley. “But Nvidia and other tech earnings are positioned to be a major weight on the market’s momentum scale.”Investors are also looking for Federal Reserve Chair Kevin Warsh to clarify his views on how the central bank should react to stubborn inflation when he speaks Friday at the annual gathering in Jackson Hole, Wyoming.For the first time as leader of the world’s top central bank, Warsh will offer keynote remarks at the Kansas City Fed’s annual Economic Policy Symposium. With Treasury yields still elevated by sticky inflation and fiscal deficit concerns, he’s under pressure to act more like his predecessors and give clearer guidance of how the Fed might react over the remainder of the year.“The Treasury’s unprecedented action in the bond market last week puts Warsh in a tough spot, especially for a Chair that seems to prefer less communication than more,” said Richard Reyle at Questar Capital Partners.On Wednesday, the government will issue the latest personal consumption expenditures price index — the Fed’s preferred inflation gauge.Elsewhere, Canada’s currency fell against the US dollar as President Donald Trump pledged to double the automobile tariff on Canadian vehicles and parts starting next year. Bitcoin’s rebound gathered momentum, with the cryptocurrency hovering near $79,000.Corporate Highlights:Elon Musk says SpaceX’s first AI satellites, powered by Nvidia Corp. chips., will initially launch in the fourth quarter of next year and hit “significant scale” in 2028. Michael Saylor’s Strategy Inc. is adding a new pool of cash to its balance-sheet toolkit, part of an effort to preserve flexibility as its once-powerful financing model remains under pressure. SoftBank Group Corp. plans a record ¥1 trillion ($6.3 billion) retail bond sale, the biggest by any issuer in Japan, as the conglomerate raises funds for its investment commitments to OpenAI. Alibaba Group Holding Ltd. raised HK$80 billion ($10.2 billion) in Hong Kong’s biggest follow-on offering, underscoring its willingness to amass and spend vast sums to take the lead in global artificial intelligence. “A growing sense that AI adoption has peaked is sapping risk appetite and weighing disproportionately on the AI trade’s pick-and-shovel providers, whose earlier outperformance leaves them more exposed to a reassessment of demand.”—Tatiana Darie, Macro Strategist, Markets Live. For the full analysis, click here.Some of the main moves in markets:StocksThe S&P 500 fell 0.2% as of 3:33 p.m. New York time The Nasdaq 100 fell 0.8% The Dow Jones Industrial Average rose 0.3% The MSCI World Index fell 0.2% CurrenciesThe Bloomberg Dollar Spot Index rose 0.2% The euro fell 0.2% to $1.1661 The British pound fell 0.1% to $1.3626 The Japanese yen fell 0.2% to 159.19 per dollar CryptocurrenciesBitcoin rose 1.9% to $78,883.63 Ether rose 0.8% to $2,469.59 BondsThe yield on 10-year Treasuries declined four basis points to 4.70% Germany’s 10-year yield was little changed at 3.25% Britain’s 10-year yield was little changed at 5.05% CommoditiesWest Texas Intermediate crude fell 2.2% to $85.11 a barrel Spot gold rose 0.8% to $4,640.77 an ounce ©2026 Bloomberg L.P.
