Bond yields reached a 19-year peak as the Federal Reserve kept interest rates unchanged for the seventh month in a row, triggering a significant drop in long-term bond prices. The 30-year Treasury yield climbed by up to 14 basis points, nearing 5.23%, driven by rising concerns over inflation and uncertainty about the Fed’s future policy direction. Market expectations for inflation rose alongside the move, contributing to a weaker dollar and mixed performance across equity markets. Despite broad unease, technology stocks offered some positive momentum.
Microsoft's strong earnings report highlighted progress in its artificial intelligence initiatives, boosting US equity futures and providing a counterbalance to bond market losses. In contrast, Meta Platforms reported disappointing revenue guidance, leading to declines in premarket trading. Analysts from Citi and CFRA examined the Fed’s communication and the divergent results among major tech firms. Andrew Hollenhorst of Citi analyzed Fed Chair Kevin Warsh’s messaging, while Angelo Zino of CFRA assessed the financial outcomes of Microsoft and Meta. Asian tech shares also advanced, influenced by Microsoft’s upbeat performance.