U.S. Treasury Yields Edge Lower as Rate Hike Expectations Weigh on Global Tech Stocks
Taylor Wilson
U.S. Treasury yields dipped on Tuesday, but fears that new Fed Chair Kevin Warsh may push for rate hikes have already triggered a global tech selloff — with Thursday's PCE inflation print now the next make-or-break data point.
How far did yields actually fall?
The 10-year yield slipped more than 2 bp to 4.481%; the 2-year fell over 4 bp to 4.190%; the 30-year eased about 1 bp to 4.937%.
On Monday the 2-year had hit its highest level since February 2025 before pulling back slightly.
This means → the retreat is tiny — markets haven't relaxed, they're just waiting for the next data signal.
Why are tech stocks getting hit?
Markets fear new Fed Chair Kevin Warsh may push for rate hikes, and that expectation alone sparked a global tech selloff.
In plain terms = higher rates raise borrowing costs; most tech firms rely on cheap capital to grow, so when rates climb, valuations compress and money exits first.
This reflects uncertainty over the Fed's policy direction spreading from bonds into equities.
The UK PM resigned — why didn't gilts react?
UK Prime Minister Keir Starmer announced his resignation — the seventh leadership change in a decade.
The frontrunner, former Greater Manchester mayor Andy Burnham, leans left, yet gilt yields barely moved — a small dip only.
This means → the bond market sees no fiscal pivot — Burnham's stance was already priced in, leaving no surprise to trade on.
Why does Thursday's PCE number matter so much?
The U.S. will release the May core PCE price index — personal-consumption expenditure prices excluding food and energy — the Fed's preferred inflation gauge.
Economists surveyed by FactSet expect core PCE to rise from April's level.
This means → if the data confirm inflation is re-accelerating, rate-hike bets will intensify; if not, the tech selloff pressure may ease temporarily. It is the single most important number for markets this week.
Content is for reference only, not financial advice.