Overview
- U.S. stocks opened the week softer with technology and semiconductor shares leading declines as investors awaited Nvidia’s quarterly report scheduled for Wednesday.
- Treasury Secretary Scott Bessent is preparing a broad economic pressure campaign on Iran and the Treasury has expanded buybacks of longer-term Treasurys to try to calm rising 10- and 30-year yields.
- Long-term yields have climbed to multi-year highs and have already pressured growth stocks, while markets caution the Treasury’s buybacks may have only limited impact on the bond curve.
- Reports that some server prices for systems using Nvidia AI chips could rise by more than 15% and growing political resistance to new data centers, including actions in Texas, increase the cost and political risk of the AI infrastructure buildout.
- Investors are also watching the Fed’s preferred inflation gauge for July and Fed Chair Kevin Warsh’s Jackson Hole remarks later in the week because both will shape rate expectations and the outlook for tech capital spending.