[New York Stocks] Long-Term Treasury Yields Rebound Despite Bessent's 'Rate Defense'... Dow Down 1.32%

Oil Prices Climb Amid Renewed Middle East Tensions
Walmart Same-Store Sales Growth Falls Short of Expectations

On the 20th (local time), all three major U.S. stock indexes ended the session lower. Although U.S. Treasury Secretary Scott Bessent once again hinted at the possibility of expanding long-term Treasury buybacks, investor sentiment was dampened by a renewed rise in U.S. Treasury yields. The surge in international oil prices, driven by escalating tensions between the U.S. and Iran and the resulting inflation concerns, also weighed on the markets.

On the New York Stock Exchange (NYSE), the Dow Jones Industrial Average closed at 52,759.21, down 703.84 points (1.32%) from the previous day. The large-cap focused S&P 500 Index fell 66.82 points (0.87%) to finish at 7,641.16, while the tech-heavy Nasdaq Index ended at 26,067.16, down 263.92 points (1.00%).

New York Stock Exchange. New York, USA – Special Correspondent Yoonju Hwang

Although Secretary Bessent told CNBC that the buyback program could be expanded to more than $4 billion per round, the uptick in U.S. Treasury yields accelerated risk-off sentiment in the markets.

According to Investing.com, as of now, the yield on the 10-year Treasury note rose by 4.8 basis points (1 basis point = 0.01 percentage point) from the previous session to 4.701%. The yield on the 30-year Treasury bond is up 5.4 basis points from the previous session, reaching 5.248%.

Adam Phillips, Managing Director of Investments at EP Wealth Advisors, stated, "The buybacks are not a panacea for the problems in the bond market," adding that there are structural factors at play that the Treasury and the administration have little control over. He continued, "The easing effects that followed past interventions were usually only short-lived. More robust measures are needed for sustained impact."

The escalation of tensions in the Middle East also exerted further downward pressure on the stock market. The day before, U.S. President Donald Trump mentioned Iran in a Truth Social post, declaring that the U.S. would launch "the most powerful economic operation ever undertaken against any country." He emphasized, "This will be an economic war and a policy of isolation on an unprecedented scale."

In this context, Secretary Bessent also stated that the U.S. would impose "the most powerful sanctions in history" on Iran. The Treasury Department plans to announce specific plans for economic pressure against Iran on the 24th.

International oil prices rose. On the New York Mercantile Exchange, West Texas Intermediate (WTI) crude for September delivery climbed 2.33% to $87.83 per barrel. On the ICE Futures Exchange, Brent crude for October delivery gained 2.36% to settle at $93.78 per barrel.

Additionally, Walmart’s earnings announcement dragged down the indexes. Walmart reported that total sales in the second quarter of its fiscal year (May–July) rose 5.9% year-on-year. However, the key metric—U.S. same-store sales excluding fuel—rose only 2.6%, marking the slowest growth in six years.

This figure reflects a slowdown from the previous quarter’s increase of 4.1% and fell short of the market consensus of 3.8%. Investors interpreted this as a sign of weakening consumer demand, sending the stock price plummeting 9.2% from the previous session.

Looking at tech stocks, Micron Technology gained 3.97%, TSMC rose 0.95%, and AMD ended up by 0.65%. Broadcom also finished the day up 0.43%. JP Morgan analyst Harlan Seo believes that the market is underestimating Broadcom’s potential and, aided by a product partnership with Alphabet, forecasts that its artificial intelligence (AI) revenue will grow 180% year-on-year.

Seo stated, "The market continues to underestimate Broadcom’s significant market dominance (over 18 months), leadership position, chip and package design expertise, aggressive pace of new product development, intellectual property (IP) portfolio, and superior execution."

This content was produced with the assistance of AI translation services.