Video summary
The market is currently experiencing a retracement from earlier gains as short-term interest rates rise significantly following recent Federal Reserve commentary. The two-year Treasury yield has surged by nearly 12 basis points to reach 4.35%, while the ten-year yield climbed five basis points, reflecting investor sensitivity to inflation and debt concerns. This shift in the yield curve has caused a broad pullback across major indices, with the S&P 500 down roughly 0.3% and the Nasdaq 100 falling over 0.8%. The Russell 2000 is particularly hard hit, dropping by nearly 1.3%, as smaller companies with shorter debt maturities are more vulnerable to rising short-term rates compared to larger tech giants that can manage long-duration debt structures.
Equity performance today highlights a divergence driven heavily by the semiconductor sector and specific large-cap technology names. Nvidia led the decline in tech stocks, contributing significantly to the Nasdaq's losses despite having no fundamental reason for such a sharp drop given its massive market capitalization. Conversely, mega-cap companies like Microsoft, Amazon, Google, and Meta managed to stay in the green, effectively propping up the broader S&P 500. This contrast underscores how chip stocks are currently carrying the market, while hyper-growth spenders remain resilient even as yields climb. The volatility is further complicated by news regarding the Treasury's plan to buy back longer-dated securities, which has reignited debates about yield suppression and created a seesaw dynamic in gold prices.
Beyond equities, the transcript notes significant movements in commodities and consumer pricing that reflect broader economic pressures. Gold has pulled back sharply by 3.3% as higher yields make non-yielding assets less attractive, while the GDX semiconductor ETF saw a substantial decline of around 4%. On the consumer front, Apple announced price hikes for its subscription services, including a jump from $13 to $15 for Apple TV and an increase of $2 for Apple One. These percentage-based increases are notable given that few companies typically raise prices by such margins, sparking discussion about inflationary pressures even within the tech sector.
Looking ahead, the speaker suggests that while today's market move is heavily influenced by short-term rate reactions, the longer-term trajectory will depend on whether the Federal Reserve can successfully control inflation and manage runaway debt. If inflation remains under control, it could help stabilize long-term yields despite current volatility in the short end of the curve. The market is expected to continue reacting to these macroeconomic factors throughout the final hour of trading, with volume remaining moderate compared to previous days. Investors are watching closely to see if today's sell-off persists or if the market finds support as the week concludes and potential policy implications from the last Fed meeting become clearer.
Read the full video transcript
I am.
>> [music]
>> Good Friday afternoon, folks. Tommy
O'Brien company live from TFNN. Thanks
for joining me for the final hour of the
trading week and we got markets right
now retracing from the acceleration
higher.
Mr. Williams, he spoke in the market.
Thanks to yeah, they may actually bring
it when you're talking about the
potential hikes that are coming down the
line. Yields higher on a short-term
basis right now. We have the two-year
pushing higher to the tune of almost 12
basis points on the two-year right now
and we got the market that pulls back
from that first acceleration. Now, Mr.
Williams was talking at about 10:00.
Okay, he wraps up at like what 10:45?
Something like that. You got an
acceleration all the way up until 11:30
and then the market gave it up. We trade
south technology stocks trading a little
bit lower driven by Nvidia of all
equities, but right now you have an S&P
down by 3/10%.
We take a look at the volume and we got
some volume today, folks. All right, we
got a whole hour left to go.
We got a weekly
finish in terms of volume and right now
we're at 1.23 million versus 1.27
yesterday. You jump over to the ETF
structure on the spy. No volume there.
On this pullback. Look at that, right?
Nice acceleration high with volume of 35
million yesterday. You're backing off
with only 25 million. Nasdaq 100 down by
8/10%. Trading at 220 points in the red
29,476.
You jump over right now to the Qs.
And look at the volume as well. Now,
you'll get some volume in the final
hour, but it's not going to be a huge
day, which is remarkable when you look
at the action two-way action in this
market higher and lower.
You got a Dow right now
barely in the red by 39 points at 53,582
and the Russell getting clobbered.
Higher yield not kind to the Russell.
Okay, Russell now 1.3% of 38 points at
2980.
Now, there's no denying, folks, the move
is to lower price and higher yield
today. That's for sure. Now, we'll see
if it carries through in terms of after
today. But right now, you take a look at
this yield curve.
Okay, especially on the shorter end,
more Fed-dependent, right? But even on
the longer end, the 10-year up by five
basis points, 4.72. Your two-year
up nearly 12 basis point, up 11. The
one-year's up 12 basis points to 4.14.
Quite a number, 4.35 on the two-year.
Excuse me, the five-year up by eight
basis points to 4.48.
So,
the chairman spoke
and the market listened. And that's your
10-year to 107.29. You jump over to the
two-year right now. That's a big move on
the two-year, folks. Down by seven
ticks to 102.24.
Yeah, how's that for you?
And that was the last Fed meeting, right
here.
Right? So, you get it all back today.
All that credibility. Let's see if it
carries through. Dollar catches a bid on
higher yield.
We're right back to where we were before
the Treasury announced that they're
going to be buying back our longer-dated
securities. So, going to be interesting
to see how that seesaw battle rages on
in gold. With quite a pullback, off by
3.3% right now.
The GDX
and yeah, that's quite an engulfing.
Okay, down by 4%, down $4.20.
You know, the other side of this, folks,
talking about this thing was up 50% in
the span of 5 weeks.
Okay?
Now,
the market's responding here.
But even a 382 brings you back to almost
90. And that's just the move you did
over 5 weeks.
Okay? So, longer term, I still think,
you know, the Treasury's going to be
suppressing longer-term yields even with
this move, right? Cuz this move
is on the shorter-term end, which should
carry through to the longer-term end,
right? If we get inflation under control
now, that will help with yields on the
longer term as well, cuz that's what the
longer term part of the curve is so
worried about right now. That we're
getting inflation, we have runaway debt,
which is inflationary as well, and if
the Fed can't get it under control,
longer term yields are going up.
Well, today short-term yields are really
reacting, long-term as well. We'll see
where we go.
All right, some equities with action
today, Marvell Technologies, down 10.4%.
Yeah, light on guidance and you're
almost at session lows right now, but
Nvidia, how about it, man?
So, they take it, they give it, and they
take it away, right? Woof.
Look at this, man.
Nvidia's got nearly 25 billion shares
outstanding, folks. That's a 275 billion
market cap loss today for no good
reason.
Right? Cuz you got a
higher yield market, okay?
And the market pulls back and Nvidia's
driving it. Now, on the flip side of
that,
look at the strength in Microsoft, up by
1.9% right now. Amazon shares up 3.6%.
You talk about it, man. Google, up 2%
right now, and Meta, up 1%. So, you jump
over the heat map,
and it's the chip stocks, right? It's
not the hyper spenders. They're carrying
this market right now. Think about it,
Microsoft, Apple, Google, Amazon were in
all in the green, woof.
Everything would be getting smoked.
That's the only thing saving the S&P
right now, down nearly just 21 points.
Yeah, there's Marvell down 11%.
Jump over to the Nasdaq 100. Yeah, the
Russell.
Okay, the Russell has a lot of equities
that are
much shorter in their duration of their
yield, so they're much more yield
sensitive, right? And
you know, you you get the Googles and
the Microsofts of the world, they'll go
out 40 years with their debt. Okay, so
they don't care what happens on a
short-term basis, but smaller companies,
they can't do that. They can't borrow um
a debt structure with a 40-year
expiration, right? Lifespan. No, they
have a much shorter lifespan, so they
become more yield
reactive. And on days like today where
you're getting a spike in higher yield,
look at the pullback we got across the
board right now. The Russell down by 30
Excuse me, 38 points. Leading the way
down.
>> [snorts]
>> Let's take a look at the Russell.
Look at this. You're almost coming into
a one-to-one. And that's from the lows
of COVID.
It's about time the Russell catches up.
Look at that.
Take a look at the weekly on this thing.
Yeah, volume's been light since this
week of June 8th.
You pushed to a high of 2974 right
there, and we're 2980 right now.
You jump over to Apple, up 1.6%.
You got Apple, Microsoft, Google.
Meta.
All in the green.
And yeah,
they're hiking subscription prices for
Apple TV and Apple One in the US. Now, a
small sliver of the business they do,
but
Apple TV, it's going to be $15
from $13.
Huge percentage hikes, right? We wonder
how percent
you know,
nobody hikes their prices 5%, man.
That's a 15.4% price hike. How's that
for you?
And Apple One goes up $2 as well.
And I do subscribe to that right now. I
like some of the stuff on there, but
they also have some some stuff that
doesn't deliver. I like F1, those
numbers on F1 are down. I don't know if
it's worth $15 a month, $180 a year. I
don't know about that.
S&P's up by Excuse me, down by 21. We'll
come back take a look at some metals.
Take a look at gold, folks.