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August 24, 2026
Good afternoon,
Markets
For the week ending 8/21/2026:
- The S&P 500 decreased 1.4% to close at 7,674.37.
- The yield of the 10-year Treasury bond increased from 4.70% to 4.74%.
- Oil increased from $82.40 to $87.06.
- The CBOE Volatility Index (VIX) increased from 14.25 to 15.13.
- U.S. dollar currency exchange rates were:
- EUR/USD: 1.17 (USD weaker from a week ago)
- GBP/USD: 1.36 (USD weaker from a week ago)
- USD/JPY: 158.88 (USD weaker from a week ago)
Market Headlines
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Stocks Slip: U.S. stocks snapped their three-week winning streak as the strong quarterly earnings season began to wind down. Markets faced pressure from a pullback in technology shares, rising long-term Treasury yields near multi-year highs, and higher oil prices amid renewed geopolitical tensions involving Iran. Despite a late week rebound, major U.S. indexes finished lower, with the S&P 500 ending 1.6% below the record high reached the previous week.
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Higher Yields: Treasury yields edged higher last week as long-term rates remained elevated amid concerns over rising government debt. The 30-year yield surpassed 5.3% last week, its highest in nearly two decades. This prompted the treasury department to intervene by doubling long-end debt buybacks. However, the initial relief rally was short-lived as persistent concerns over mounting national debt and heavy capital competition pushed yields higher again.
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Oil Rises Again: Oil prices rose for a second consecutive week, gaining approximately 5% as ongoing tensions in the Middle East continued to disrupt energy markets. Commercial traffic through the Strait of Hormuz remains well below normal levels, while Washington's threat of additional economic sanctions has heightened concerns about global oil supplies. Although U.S.-assisted tanker movements have helped maintain some oil flows through the region, overall shipping activity remains significantly below pre-conflict levels.
Key Takeaway
As the strong corporate earnings season winds down, investors have shifted their attention toward the bond market. After stocks reached fresh record highs earlier this month, rising long-term Treasury yields halted the market’s rally last week. Persistent inflation concerns, rising government debt and increased Treasury issuance have led investors to demand higher yields as compensation for the added risks associated with holding longer-term bonds. The 30-year Treasury yield reached its highest level since 2007, while the 10-year Treasury yield climbed to approximately 4.7%, up from about 4.2% at the start of 2026. The rise in yields has also increased borrowing costs across the economy, adding pressure to businesses and consumers while reinforcing concerns that interest rates could remain elevated for longer than previously expected. Going forward, investors should continue to closely watch inflation data and Federal Reserve commentary, as the direction of long-term interest rates is likely to remain an important driver of both bond and stock market performance.
The Week Ahead: August 24 – 28
- Monday: No major reports scheduled
- Tuesday: Consumer confidence, New home sales, Home price index
- Wednesday: PCE index, GDP, Durable goods
- Thursday: Initial jobless claims
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Friday: Consumer sentiment
Until next week,
Weller Financial Group
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