Stocks Fall Early as Treasury Rally Fades
August 20, 2026
Stocks fell in early trading as Treasury yields rebounded, wiping out most of the previous day's decline. Higher oil prices and Walmart results also hit shares.
Published as of: August 20, 2026, 9:06 a.m. ET
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| The markets | Last price | Change | % change |
|---|---|---|---|
| S&P 500® Index | 7,707.98 | +16.22 | +0.21% |
| Dow Jones Industrial Average® | 53,463.05 | +119.65 | +0.22% |
| Nasdaq Composite® | 26,331.09 | +41.38 | +0.16% |
| 10-year Treasury yield | 4.69% | +0.04 | -- |
| U.S. Dollar Index | 98.75 | -0.08 | -0.08% |
| Cboe Volatility Index® | 15.88 | +0.99 | +6.65% |
| WTI Crude Oil | $86.91 | +2.52 | +2.99% |
| Bitcoin | $71,730 | +$3,155 | +4.60% |
(Thursday market open) Stocks fell ahead of the opening bell as U.S. Treasury yields rose, erasing most of Wednesday's decline and indicating the boost to equities from the Treasury Department's plan to tamp down yields might be short-lived.
Disappointing earnings from Walmart (WMT) and higher oil prices also weighed on stocks. Walmart reported the slowest quarterly sales growth in more than six years this morning, pushing its shares down more than 6% and heightening the focus on retailers in what so far has been a mixed reporting season for the group. WTI crude oil topped $87 a barrel in early trading, while weekly initial jobless claims fell to 206,000, down from a revised 212,000 a week earlier.
On Wednesday, stocks galloped out of the gate and then spent most of the day slowly declining until the S&P 500 Index ended up just slightly. Still, it broke a three-day losing streak and managed to claw above 7,700, only about 100 points below its all-time high posted a week ago. The Russell 2000® (RUT) small-cap index outpaced other major indexes as yields declined.
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Three things to watch
- Assessing Treasury's move: Yesterday's news of the Treasury Department expanding buybacks of long-dated government debt—with liquidity support for the 10- to 30-year sector at least doubling—initially sent the 30-year bond yield to its sharpest daily loss of the year. That followed a recent rally to the highest yields since the 2008-2009 financial crisis, pushed by heavy issuance of sovereign and corporate debt both in the U.S. and around the world and by rising oil prices. The program isn't large enough to change the broader supply backdrop, but it signals that the Treasury is aware of pressure in long-end yields and willing to provide liquidity support. One caveat: The program is effective September 9 through November 4. That means it ends the day after the November 3 mid-term election. The program may be short, but perhaps the Treasury Department hopes it can prevent heavy Treasury selling in the future if investors fear another government intervention, analysts said. It also comes soon after Treasury Secretary Scott Bessent stepped in to help Japan support its tepid yen, a move seen as preventative to keep Japan from selling U.S. Treasury holdings.
- Software earnings a test for sector: Though software shares skidded earlier this week as AI-related shares gained—a common theme lately since AI is expected to have different impacts on the two—software has been on the recovery path lately. Oversold conditions, hopes for industry consolidation, and cybersecurity strength as AI raises worries about security risks appeared to help shares of companies like CrowdStrike (CRWD) and Palo Alto Networks (PANW). Next week, several large software companies report earnings, including Salesforce (CRM), Autodesk (ADSK), Synopsys (SNPS), CrowdStrike, and Workday (WDAY). What they have in common is recent earnings beats. Namely, in the first quarter, each easily exceeded analysts' earnings per share consensus. Another thing they have in common is climbing shares, meaning the bar could be higher to deliver more evidence of rising profit despite AI competition. Failure might give investors second thoughts about software's impressive recovery from the slump earlier this year.
- Dispersion disperses: Earlier this summer, dispersion in the U.S. stock market skyrocketed, meaning individual stocks showed far more volatility than the broader indexes. That's changed in recent weeks, possibly reflecting the July bear market in semiconductors that reversed to some extent this month. It's not fair to say there's been a full rotation away from volatile tech, which is still up nearly 5% over the last month versus 3.5% for the S&P 500 Index, but other sectors—notably health care, energy, and materials—have climbed as much or more since mid-July. That continued over the last week, with defensive staples and real estate also among market leaders. This suggests investors are exposed to a broader swath of names outside the once roaring chip and Magnificent Seven stocks (the Magnificent Seven are basically flat since last November). As of midday Wednesday, 72% of S&P 500 stocks traded above their 200-day moving averages, near the highest point of the year and historically strong.
Crypto currents
Bitcoin leaps out of trading range as yields fall: Bitcoin jumped to the highest level in more than two months Wednesday, rising about 6% after the Treasury announcement. Longer-term yields and the dollar fell afterward. The cryptocurrency broke above its 200-day moving average in overnight trading after briefly topping it yesterday, which last happened in November 2025.The price topped $71,000 early Thursday. Bitcoin had traded in a narrowing range over the past two months, with elevated yields helping keep the price pinned near the lows of the current bear market despite a weakening dollar, which typically would support bitcoin's price. Crypto also got a boost from President Trump's efforts to pressure Congress to pass the Clarity Act. Bitcoin spot exchange-traded products saw the biggest one-day net inflow in more than three months, according to data from Glassnode.
On the move
- Deere (DE) rose more than 3% in pre-open trading after reporting its first quarterly profit in three years and raising its full-year forecast, driven by tariff refunds and an AI construction boom.
- Alibaba (BABA) fell about 3% before the opening bell after reporting a quarterly decline in profits of about 75% due to higher spending on AI.
- Moderna (MRNA) fell more than 9% in pre-market trading Thursday, a day after it rose 177% and Merck (MRK) rose 12.5%. The companies said a late-stage study of an experimental mRNA-based vaccine met its prime goal of extending the time before high-risk melanoma returns in patients. The dramatic gains in Moderna might reflect short covering, as shorts had previously targeted shares.
- NetEase (NTES) fell nearly 4% after reporting earnings that fell short of expectations.
- Crypto stocks jumped in early trading. Strategy (MSTR) rose about 9% early Thursday after climbing 12% Wednesday. Its executives were among crypto leaders meeting Wednesday with President Trump, according to Brieifng.com. Circle Internet Group (CRCL) rose more than 4% early Thursday after gaining more than 9% a day earlier. Coinbase (COIN) gained 6% before the opening bell, following a rise of more than 9% Wednesday.
- Gold and silver both climbed more than 3% Wednesday on the Treasury's buyback, which dragged the dollar to its lowest close in three months. Analysts said the move is bearish for the dollar, and gold tends to strengthen when the dollar weakens. Mining stocks rose on the move by the metals. Gold pulled back less than 1% early Thursday, while silver rose less than 1%.
More insights from Schwab
High-yield municipal bond primer: High-yield municipal bonds carry additional risks, but some investors in high tax brackets and longer investment time horizons may want to consider this asset class. High-yield munis differ from investment-grade municipal bonds because they have credit ratings that are below investment grade or have no credit rating at all.
What are ADRs? Some of the market's biggest tech names—including Taiwan Semiconductor (TSM) and ASML (ASML)—trade in the United States but aren't included on the S&P 500 Index because they're American Depositary Receipts (ADR). Learn more about how ADRs work, along with their potential risks, in our latest investment update.
Chart of the day
Data source: CME Group. Chart source: thinkorswim® platform.
Past performance is no guarantee of future results.
For illustrative purposes only.
Bitcoin (BTC/USD—candlesticks) broke out of a narrowing trading range Wednesday, hitting the highest level in more than two months, topping its 200-day moving average (green line) in overnight trading.
The week ahead
Check out the investors' calendar for a summary of the top economic events and earnings reports on tap this week.
August 21: No major earnings or data expected.
August 24: No major earnings or data expected.
August 25: August Consumer Confidence, July new home sales, and expected earnings from Bank of Montreal (BMO), Dick's Sporting Goods (DKS), Intuit (INTU), and Zoom (ZM).
August 26: July PCE and core PCE, July personal income and spending, second quarter GDP second estimate, July durable orders, and expected earnings from Nvidia (NVDA), Salesforce (CRM), Williams-Sonoma (WSM), CrowdStrike (CRWD), Synopsys (SNPS), Agilent (A), HP (HPQ), and Okta (OKTA).
August 27: Expected earnings from Royal Bank of Canada (RY), Toronto-Dominion Bank (TD), Dollar General (DG), Dollar Tree (DLTR), Burlington Stores (BURL), Best Buy (BBY), Marvell Technology (MRVL), Autodesk (ADSK), Workday (WDAY), Affirm Holdings (AFRM), and Ulta Beauty (ULTA).