The Nasdaq Composite continued falling more than half a percent during the day. TangentThe recent weakness in tech stocks has coincided with a rise in Treasury yields – the 10-Year yield has almost doubled from 0.917% to 1.641% year-to-date. “The concern for tech stocks is that the Federal Reserve will have to hike interest rates to combat inflation sooner rather than later,” he says. “If that happens, the cost of borrowing for many growth stocks becomes more expensive. Since tech is mainly growth-oriented, higher [Treasury] yields and higher interest rates can greatly impact the tech sector as a whole.” Stoltzfus comments that the jump in the 10-year yield may be “a tad too fast as it has currently unfolded but it is not uncommon for the bond market to overreact.”Further ReadingWhat Tech Stocks To Buy In 2021 After Nasdaq’s 45% Return In 2020 (Forbes)Dow Tests New High, But Tech Stocks Sink Again As Treasury Yields Spike Further (Forbes)

Source: Forbes March 18, 2021 18:11 UTC