This is an edition of the Markets P.M. newsletter, a recap of the day's most important markets moves, delivered after the closing bell. If you're not subscribed, sign up here.
What Happened in Markets Today
The 30-year U.S. Treasury yield is hovering around its highest level in nearly two decades. It rose to as high as 5.337%, its highest intraday high level since 2007. Japanese long-dated yields ended the day at their highest level since at least 2006. Besides concerns about fiscal conditions and inflation, a key thing pushing up yields is the AI industry's huge appetite for debt, which puts it in competition with traditional nation-state borrowers.
Equities struggled, with the Nasdaq down 1.3%. Chip stocks are getting hit hard, with the PHLX Semiconductor index down 5% and some of its components down 7% or more. The S&P 500 fell 0.7% and the Dow closed down 0.2%.
Renewed tensions in the Middle East are also weighing on markets. An unknown projectile struck a cargo ship in the Strait of Hormuz overnight, the British navy's marine-traffic monitoring agency said. The attack came after a 60-day truce between the U.S. and Iran expired yesterday with few signs of progress towards a permanent deal to replace it. Brent crude oil prices are hovering around $91 a barrel.
Klarna shares had their worst day since February. The "buy now, pay later" service provider reported earnings before the bell today. Shares plunged 23% after the company cut its 2026 revenue guidance below Wall Street estimates. This outlook eclipsed Klarna's strong second-quarter results. The Swedish fintech company said it was facing softer consumer discretionary spending in Germany, its largest market, alongside a drag from currency translation.
Markets at a Glance
One Big Story
The swift unwind of Situational shows how quickly information can spread across Wall Street when a trader is in trouble-and how fast it can lead to an avalanche of selling. It is a brutal lesson, too, in the risks of leverage, or investment bets fueled by borrowing, several years after Archegos Capital's implosion.
Aschenbrenner built his firm on his reputation as an AI soothsayer. Others pointed to lengthy investing track records when launching hedge funds or venture-capital funds; Aschenbrenner's stature stemmed from a 165-page essay in 2024, "Situational Awareness: The Decade Ahead," that foresaw the path of AI's development.
What's Coming Up
Target Corporation and TJX Companies are among the companies reporting financial results tomorrow.
Minutes of the Federal Open Market Committee meeting will be released.
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About Us
Markets P.M. catches you up on the day's most important markets moves, delivered after the closing bell. This email was written by David Wainer for Heard on the Street, The Wall Street Journal's home for financial analysis and commentary. To send us your feedback, reply to this email. Got a tip for us? Here's how to submit.