Tech Stocks Drag Markets Lower Early

Published as of: August 24, 2026, 9:05 a.m. ET

(Monday market open) The major stock indexes fell in early trading Monday, dragged down by tech, but they pared their losses after CNBC reported that the Treasury Department could use its $1 trillion general account to fund its buyback plan. Yields fell after the report came out.

It's a big week ahead. Nvidia (NVDA) reports Wednesday and Marvell (MRVL) follows Thursday, offering the latest snapshots of the AI trade. On the economic front, Personal Consumption Expenditures (PCE) inflation data is due Wednesday, and Federal Reserve Chair Kevin Warsh is due to speak at the Fed symposium in Jackson Hole on Friday. Skeptical investors are looking for Warsh to convince them he's committed to the inflation fight.

Stocks rebounded Friday on light volume, ending their worst week in more than a month on a positive note, despite Treasury yields rebounding to near their highest level in more than a decade. The S&P 500 Index shed 1.4% on the week, snapping a three-week win streak. The materials, health care, and financials sectors led the way.

1. What's driving longer-term Treasury yields? The recent surge in longer-term Treasury yields to multi-year highs doesn't necessarily mean investors expect an era of higher inflation ahead, said my colleague, Collin Martin, head of fixed-income research and strategy at the Schwab Center for Financial Research (SCFR). In fact, inflation expectations are lower than they were in March, and near the bottom of their range over the past two to three years, Martin said. "Inflation expectations are very well-behaved," he said. But uncertainty over inflation is a key factor, particularly given fiscal concerns, and it's causing investors to demand a higher term premium, or extra yield for buying those longer-dated bonds, Martin said. The distinction between expectations and uncertainty is important. Even if inflation shows signs of trending lower, fiscal concerns and uncertainty about the long-term outlook should keep yields elevated. But while yields are likely to remain higher for longer, that doesn't mean they'll necessarily go significantly higher from here, Martin said.
    
2. A jolt of adrenaline and a sigh of relief for many bitcoin investors: Bitcoin recorded its biggest weekly gain in more than two years last week, breaking out of a long sideways drift. Bitcoin investors got the catalyst they had been waiting for Wednesday morning when the Treasury Department said it would expand its bond buybacks to contain yields. Bitcoin had jumped 20% since the Treasury announcement as of Friday, and more than 23% for the week. Short covering helped ignite the rally. About $500 million of bitcoin shorts were liquidated within minutes as price rallied past $67,000 a couple hours after the Treasury announcement, according to Glassnode. A falling U.S. dollar, President Trump pushing for passage of the Clarity Act later in the day, and other regulatory developments were also cited as catalysts. Whatever the reasons, investors were jumping back in at least for a few days. On Wednesday and Thursday, spot bitcoin exchange-traded products (ETP) saw the biggest two-day net inflows since mid-January, with the total topping $1 billion, according to Glassnode data.
    
3. S&P leadership check: A look under the hood shows that health care, energy, and materials sectors have led the S&P 500 over the past month. With oil prices elevated for months, it should come as little surprise that energy stocks have been on a tear lately. As of the market close Thursday, the energy sector was up 42% so far this year and had gained 7% in August, with 62% of the sector's stocks at a four-week high and one-third of them at a 52-week high. Compare that to the overall S&P 500, which saw 12% of its constituents at a four-week high and only 3% at a 52-week high, and was up a solid but decidedly less impressive 12% on the year. Meanwhile, more than one in five S&P 500 health care stocks were at a four-week high, and 12% had hit a 52-week high. None of the index's materials companies registered a 52-week high, but 24% had hit a four-week high.

• Chipmakers fell in early trading Monday, with Marvell dropping more than 2%, and Advanced Micro Devices (AMD) and Intel (INTC) each shedding more than 1%. Nvidia was flat.
   
• Memory chip stocks also lost ground before the opening bell. Sandisk (SNDK) was down nearly 5%, while Western Digital (WD) and Seagate Technology (STX) both fell about 3%.
   
• U.S. steelmakers got a boost from the collapse of U.S.-Canada trade talks Friday. Nucor (NUE) and Steel Dynamics (STLD) both rose about 4% in pre-market trading.
   
• Moderna (MRNA) shed nearly 1% before the open Monday. It gained nearly 9% Friday after a wild week that saw it rise more than 130% after a cancer vaccine it is developing with Merck (MRK) showed promising results. Merck gained nearly 13% on the week.
   
• WTI crude oil futures (/CL) fell nearly 2% in pre-market trading.
   
• Bitcoin futures (/BTC) rose nearly 2% in early trading.
   
• U.S.-listed shares of Alibaba (BABA) fell more than 2% ahead of the opening bell after the company said it would issue $10.2 billion of shares to non-U.S. investors.
   
• Gold futures (/GC) gained nearly 2% Friday and more than 5% on the week as the Treasury tried to tamp down longer-term yields and the U.S. dollar slid.
   
• Ross Stores (ROST) rose more than 4% Friday after it reported better-than-expected earnings and raised its full-year outlook.
   
• Crypto-related companies Strategy (MSTR), Coinbase (COIN), and Circle (CRCL) each gained at least 5% Friday as bitcoin and other cryptocurrencies ripped higher. They were all little changed ahead of the opening bell Monday.
   
• HCA (HCA) rose more than 5% Friday to the highest close since mid-May as health care stocks outperformed the broader market.

In a chart that measures the returns of the S&P 500 Health Care Index ($SP500#35—candlesticks) against S&P 500 Index ($SPX—cyan line) since the start of 2026, the health care sector closely tracked the broader index for the first four months of the year. The SPX briefly separated itself in April. After a 20% rally since May 1, the health care sector is now at all-time highs and just barely outperforming so far this year.