Chipmaker Sell-Off Drags Down Major Stock Indices
Major U.S. stock indices are down sharply on August 18, with the Nasdaq Composite falling over 1.7% due to a sell-off in chipmakers and rising bond yields. The S&P 500 is near a two-week low as global investors react to higher borrowing costs that weigh especially heavily on high-growth technology stocks. The decline follows increased geopolitical tensions, particularly between the U.S. and Iran over control of the Strait of Hormuz, which has pushed crude oil prices up to a three-week peak. This rise in energy prices is stoking inflation fears globally while bond yields hit multi-decade highs—Japan’s 10-year JGB yield reached 2.967%, Germany's Bund at 3.272% and U.S. T-notes climbed to 4.75%. However, markets saw some recovery as these rates eased slightly later in the session. Economic data was mixed: housing starts dropped sharply while building permits rose above expectations. Import prices also exceeded forecasts, adding complexity to inflation concerns.
