Weekly Market Update for August 21, 2026

by Gavyn Jensen-Schneider, Research Associate

It was a bumpy week for the market as rising bond yields and an unexpected intervention by the US Treasury Department amped up uncertainty. The S&P 500 finished the week down -1.43%, while the Nasdaq fell -2.05%. The 10-Year Treasury yield, an interest rate indicator, closed at 4.74%, +5 basis points (bps) from last week. The 6-Month US Treasury, a favorite of our US Treasury strategy, closed at 3.92%, up +1 bp from last week.

The 30-year US Treasury yield has been creeping upward in recent weeks, reaching 5.33% on Tuesday, a high not seen since prior to the Great Financial Crisis. Treasury Secretary Scott Bessent announced Wednesday that the Department of the Treasury will be doubling buybacks of long-term Treasury bonds in an effort to lower long-term bond yields. Bessent said in a CNBC interview Thursday that “we believe the yields don’t reflect the underlying fundamentals.” The announcement was unusual in its timing, as the Treasury typically adjusts bond buybacks and issuance at the Quarterly Refunding announcement, the most recent of which was on August 5^th.

An unforeseen intervention such as this could challenge the credibility of the Treasury and have second-order implications for the Fed. The move to buy back additional long-term bonds will be paid for with increased Treasury bill issuance—ranging from 4-week to 1-year maturities—potentially pushing up short-term borrowing rates. Increased buybacks could also make the Fed’s job of controlling inflation more difficult; the Treasury intervention is intended to bring down long-term yields and boost the economy through increased borrowing. The Fed, on the other hand, fights inflation by increasing interest rates, thereby increasing long-term yields and slowing borrowing. The two institutions could be at odds with each other if the Fed votes to raise rates next month.

Facebook and Instagram owner Meta was in court this week in a landmark social media case. California, Colorado, Kentucky, and New Jersey represent 25 other states in prosecuting Meta over “certain addictive design features” on its platforms, harvesting data of users under age 13 without consent, and misleading the public about platform safety. The case is often likened to the Big Tobacco lawsuits of the 1990s and could have similarly radical consequences for the social media landscape. The jury trial will take place over the coming months, with a lengthy appeal process likely to follow regardless of which side prevails.

Inflation data is on the menu for next week with the release of July’s topline and core Personal Consumption Expenditures (PCE) price index. The corporate earnings calendar has a few interesting names, including tax and business software provider Intuit (INTU) and cybersecurity software provider CrowdStrike (CRWD), but most of the week’s attention is focused on chip giant Nvidia (NVDA), which reports Wednesday.