Tech stocks rise as Treasury yields and oil prices pull back

The Nasdaq Composite climbed 0.4% on Tuesday after Treasury yields and oil prices eased, offering stocks some relief from the headwinds that had battered markets to start the week. The S&P 500 gained 0.1%, while the Dow Jones Industrial Average slipped 32 points, or 0.1%.

Technology stocks led the advance. AMD stock climbed 1% after the company announced the acquisition of AI firm World Labs. Nvidia stock rose 0.7%, and Meta Platforms stock added 1.1%.

The 10-year Treasury note yield slipped to 5.209%, a decline of more than 3 basis points, and the 30-year bond shed about 2 basis points to settle at 5.54%. Despite the day’s move lower, the 10-year yield held close to its highest levels since 2007, and the 30-year remained near territory last reached in 2004.

Oil prices moved lower as well, with Brent crude losing more than 1% to trade near $103.75 a barrel and WTI dropping 1.8% to $90.85.

The relief came after a rough Monday. Monday’s session saw the Dow shed more than 300 points, with the S&P 500 and Nasdaq closing down 0.8% and 0.9%. Surging crude prices are forcing central banks to consider further rate hikes, according to The Wall Street Journal, a dynamic that raises costs for businesses and households alike. The Reserve Bank of Australia raised its rate to a 15-year high on Tuesday, according to the Journal.

The dollar has also strengthened in this environment. The greenback gained 1.5% against a basket of currencies in September, following two months of declines.

Markets were also awaiting a slate of economic releases that analysts said could move the bond market. The September reading on U.S. consumer confidence was due at 10 a.m. ET, along with the August jobs openings and labor turnover survey.

In a Tuesday morning note, Mark Haefele, chief investment officer at UBS Global Wealth Management, recommended that investors remain positioned for further equity gains while keeping diversification at the core of their exposure. On fixed income, Haefele added that more income-focused investors may prefer short-maturity bonds to limit duration risk, while those able to tolerate volatility may find tactical opportunities in medium- to long-duration high-quality bonds.