TLDR
- The Dow, S&P 500, and Nasdaq all fell on Tuesday as bond yields and oil prices weighed on markets
- The 10-year Treasury yield hit 4.75%, its highest intraday level since January 2025
- Brent crude oil rose above $92 per barrel after two tankers were struck near the Strait of Hormuz
- Tech stocks were hit hardest, with the Nasdaq down nearly 0.9% as AI-linked debt costs rose
- Job openings ticked up slightly in July, while US manufacturing expanded for an eighth straight month
US stocks fell on the first trading day of September as rising bond yields, higher oil prices, and uncertainty over the Iran conflict pushed investors to the sidelines.
The Dow Jones Industrial Average dropped around 0.4%, or roughly 208 points. The S&P 500 fell 0.5%, and the Nasdaq Composite slid close to 0.9%.
Bond Yields Rise to Multi-Year Highs
The 10-year Treasury yield climbed to 4.75% during Tuesday’s session, its highest intraday level since January 2025. The 30-year yield reached 5.27%, near multi-decade highs, before pulling back slightly.
Yields just won't stop.
You know it's bad when bond market is quite literally ignoring the US Treasury.
24 hours later and the 10Y Note Yield is now pushing into 4.80%, its highest since January 2025.
That's another +20 basis points since the low seen after the US Treasury's… pic.twitter.com/XUOD5PQQC6
— The Kobeissi Letter (@KobeissiLetter) September 1, 2026
Higher yields make borrowing more expensive. That is bad news for tech and AI companies that have been using debt to fund large spending programs.
Citi strategists pointed out that the market is more exposed than ever to the AI trade, which makes it more sensitive to moves in bond yields.
Cross-asset analyst Nic Puckrin said the “summer party for risk assets is over” and warned investors to “prepare for a sell-off, especially in long-duration equities like tech and AI.”
Oil Prices Add to Market Pressure
Brent crude futures traded above $92 per barrel on Tuesday. Two oil tankers were struck while trying to exit the Strait of Hormuz, according to Bloomberg, raising fresh concerns about the US-Iran conflict spreading further.
Elevated oil prices add to inflation worries, which in turn feeds speculation that the Federal Reserve could raise interest rates again.
Tech was among the worst-performing sectors, falling 1%. CrowdStrike, Lumentum, and Palo Alto Networks were among the biggest decliners in the S&P 500.
Stocks came into September with double-digit year-to-date gains and rising earnings expectations. But September is historically the weakest month for stocks, and this year comes loaded with extra risk.
On the economic data front, the Job Openings and Labor Turnover Survey showed a slight uptick in July job openings. US manufacturing activity expanded for an eighth straight month, though the pace slowed a little.
Earnings releases from Dell and Palo Alto Networks are expected to offer a look at how large companies are spending on tech and cloud services.
The Nasdaq ended the session down 233 points. The S&P 500 lost around 40 points. The Dow fell just over 200 points.
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