Market Data / Market note
Market On Close: Rising Yields Test Tech Strength as Inflation Data Approaches
Can Tech Hold Up as Yields Rise Ahead of Inflation Data?
Stocks finished under pressure, with the S&P 500 Index (SPX) falling as Treasury yields and rising oil prices added to inflation concerns, while technology held up better than the broader market. The bigger relationship now is straightforward: if oil and yields keep rising into this week’s inflation data, stocks may struggle to confirm the breakouts now developing across semiconductors and artificial intelligence-related names.
In One Minute
The SPDR S&P 500 ETF Trust (SPY) fell 0.55%, while the Invesco QQQ Trust (QQQ) slipped only 0.08%, showing that technology is still cushioning broader market weakness. The U.S. 10-year Treasury yield is pressing against 4.809%, oil is pushing toward $98.30, and the VanEck Semiconductor ETF (SMH) is trying to confirm a breakout above its channel and 50-day moving average. PPI on Thursday at 8:30 AM and CPI on Friday at 8:30 AM are the next major catalysts.
The Setup
SPY remains under more pressure than QQQ. SPY has support at $760.40 and resistance near $772.21, while QQQ has spent two days consolidating after a three-day bounce with support at $712.50.
SMH is the chart to watch for growth stocks. It moved above the top of its longer-term parallel channel and closed near the 50-day moving average, but a similar move in August failed the following day. Confirmation still matters.
What Changed
The U.S. 10-year Treasury yield reached 4.812% and is consolidating just below 4.809% resistance. A breakout brings 5% and 5.021% into focus.
West Texas Intermediate Crude Oil (WTI) also pushed above recent July pivots as Middle East escalation increased, making $98.30 the next major resistance area.
Gold fell 1.58% toward $4,333 support, while silver declined 0.8% and remained stronger. Natural gas fell 1.94%, but its breakout structure remains intact above $2.90.
Why It Matters
Higher oil can keep inflation pressure alive, while higher Treasury yields can limit stock rallies. That makes this week’s inflation data especially important because several technology- and artificial intelligence-related stocks are already sitting near breakout levels.
Lumentum Holdings Inc. (LITE) is testing $977.60. Intel Corporation (INTC) is watching $105.60. SanDisk Corporation (SNDK) needs a close above $1,751. Advanced Micro Devices, Inc. (AMD) gained 5.9% and is working toward the larger $523.40 trend line. CoreWeave, Inc. (CRWV) needs to clear $108.17 before the probability improves for a move toward the $130 range.
Bloom Energy Corporation (BE) has already broken higher, but its daily RSI reached 69.3. Support on a pullback sits around $235.50 to $220.
Key Levels
| Asset | Current Area | Support | Resistance | What Matters |
|---|---|---|---|---|
| SPY | Down 0.55% | $760.40 | $772.21 | Higher rates favor pressure toward support |
| QQQ | Down 0.08% | $712.50 | $724.16 | Technology remains relatively stronger |
| U.S. 10-year yield | 4.812% high | 4.809% | Breakout brings 5% and 5.021% into focus | |
| Gold | Down 1.58% | $4,333, $4,300, $4,297 | Breaking below the channel increases downside risk | |
| Silver | Down 0.8% | $63.26 | $67.99 | Lower move could eventually reach the low $50s |
| WTI | Moving higher | $98.30 | Geopolitical escalation is supporting price | |
| Natural gas | Down 1.94% | $2.90 | $3.24 | Breakout remains intact above $2.90 |
Bull Case
The bullish path starts with technology continuing to outperform and SMH confirming its breakout with additional closes above the 50-day moving average and channel. A softer reaction in yields would also give stocks more room to extend higher.
For individual names, confirmed moves above $977.60 on LITE, $105.60 on INTC, $1,751 on SNDK, $523.40 on AMD, and $108.17 on CRWV would strengthen their respective setups.
Bear Case
The main risk is yields breaking above 4.809% and moving toward 5%. That would likely increase pressure on the broader market and limit rally attempts.
SPY losing $760.40 would weaken the index setup. Gold breaking $4,300 and $4,297 would open the door to deeper downside, while silver remains vulnerable to a move toward the low $50s or even a brief break through $50.
What to Watch Next
PPI arrives Thursday at 8:30 AM, followed by CPI Friday at 8:30 AM. Those reports could determine whether yields break higher, whether SMH confirms its breakout, and whether the broader market can stabilize heading into next week’s Federal Open Market Committee meeting.
Bottom Line
Technology is still holding the market together, but oil and Treasury yields are making that job harder. The single most important relationship now is whether inflation data allows the 10-year yield to stay below 4.809%, because that could decide whether these technology breakouts confirm or fail.