A RALLY in tech shares ran out of steam yesterday, as US stocks mostly retreated amid worries over higher Treasury bond yields that offset investor appetite to keep buying equities.

European and Asian stocks pushed higher, following up on Monday’s session in New York, which saw the tech-focused Nasdaq surge.

The Nasdaq eked out a 0.1% gain yesterday but both the Dow and S&P 500 retreated.

“Today it’s a sober mindset,” said Interactive Brokers strategist Steve Sosnick.

He added that Monday’s rally in tech shares was probably “overenthusiastic” in light of rising bond yields.

Stocks have been under pressure in August, most recently due to a spike in Treasury bond yields to multi-year peaks, on expectations that interest rates will stay higher for longer.

Markets are looking ahead to an address on Friday by Federal Reserve Chair Jerome Powell for clues on future monetary policy.

Powell “likely will continue to emphasise the Fed’s laser-focus on taming inflation, even with the central bank’s benchmark funds rate already at the highest level in 22 years,” said a note from Charles Schwab.

There is also still unease among traders about the Chinese economy, with another small cut in interest rates doing little to allay fears of a painful slowdown.

While authorities have pledged a series of measures to get the post-Covid recovery back on track, there has been little detail and they are facing growing calls to unveil more wide-ranging stimulus.

Adding to the problems are fears about the country’s property sector. A number of major developers, including Country Garden and Evergrande, are on the ropes with vast debts and struggling to meet interest obligations.

“Policy easing announcements intended to invigorate market confidence have fallen short of their desired impact,” said SPI Asset Management’s Stephen Innes.

Key figures around 2130 GMT

New York - Dow: DOWN 0.5% at 34,288.83 (closed)

New York - S&P 500: DOWN 0.3% at 4,387.55 (closed)

New York - Nasdaq: UP 0.1% at 13,505.87 (closed)

London - FTSE 100: UP 0.2% at 7,270.76 (close)

Frankfurt - DAX: UP 0.7% at 15,705.62 (close)

Paris - CAC 40: UP 0.6% at 7,240.88 (close)

EURO STOXX 50: UP 0.8% at 4,260.37 (close)

Tokyo - Nikkei 225: UP 0.9% at 31,856.71 (close)

Hong Kong - Hang Seng Index: UP 1.0% at 17,791.01 (close)

Shanghai - Composite: UP 0.9% at 3,120.33 (close)

Euro/dollar: DOWN at $1.0851 from $1.0896 on Monday

Pound/dollar: DOWN at $1.2729 from $1.2756

Euro/pound: DOWN at 85.16 pence from 85.41 pence

Dollar/yen: DOWN at  ¥145.85 from  ¥146.22

Brent North Sea crude: DOWN 0.5% at $84.03 per barrel

West Texas Intermediate: DOWN 0.3% at $80.35 per barrel – AFP, August 23, 2023.