Tech rebound pushes Treasury yields higher, dents safe‑haven demand

Treasuries slipped on Monday as a rebound in U.S. technology shares drained demand for the safe‑haven government debt. Yields rose six to eight basis points across the curve, with the 10‑year benchmark climbing over six points to 5.14%. Traders rebuilt bets on Federal Reserve rate hikes next year and kept pricing in a quarter‑point increase in December. The Nasdaq 100 Index jumped 1.2% as the artificial‑intelligence trade re‑emerged after a sharp decline that had been the steepest in more than a year. "Market positioning is still quite tenuous given the recent whipsaw selloff and rally, which is keeping a lot of investors away, exacerbating the day‑to‑day moves," said Gennadiy Goldberg, head of U.S. interest‑rates strategy at TD Securities. Last week the tech index had fallen the most since April 2025, briefly reviving Treasury demand as a hedge against equity losses. Higher oil prices added pressure; WTI crude rose 2.2% to a month‑high and Brent hit a five‑month peak before easing. After the U.S. attack on Iran in late February, oil‑driven inflation sparked the first Fed hike since 2023. UBS strategists lifted their year‑end target for the 10‑year yield to 5.2% citing a more hawkish Fed path and higher oil prices. Short‑term Treasuries could rally if the Fed skips its Oct 28 meeting, a scenario the market now sees about a 20% chance. New corporate bonds also pulled money away, with Walmart issuing an unexpected debt offering and Kimberly‑Clark planning a bond sale to fund its near‑$7 billion Kenvue acquisition. European yields rose too, led by French 10‑year bonds gaining 14 basis points to almost 4.95% – the highest since 2002 – as France faces cost‑of‑living riots and a looming Moody’s downgrade risk.

Context

Higher Treasury yields reflect tighter monetary expectations and a shift away from safe‑haven buying as investors chase returns in tech stocks and corporate bonds. Rising oil prices and European fiscal strains add further pressure on global bond markets.