Advanced Micro Devices, Broadcom, Meta Platforms and Nvidia all fell Tuesday as the 30-year Treasury yield hit its highest level since 2007. The sell-off stayed concentrated in tech and semiconductor names while the broader market barely moved, and strategists disagree on how much of the yield rise comes from AI-related borrowing versus government debt.
Advanced Micro Devices fell 5% Tuesday. Broadcom and Meta Platforms both dropped around 3%, and Nvidia slid 2%. The 30-year Treasury yield hit its highest level since 2007.
This was not a broad rout. The Invesco QQQ Trust lost 1.4%. The VanEck Semiconductor ETF dropped 4.3%. The equal-weight S&P 500 edged up 0.2%, so the pain stayed concentrated in tech and AI names rather than spreading across the market.
Why rising yields hit tech hardest
Higher interest rates make future earnings worth less today, and tech valuations lean heavily on earnings far in the future. They also make the enormous AI infrastructure buildout more expensive to finance.
Bokeh Capital's Kim Forrest told Reuters that higher yields mean a tighter borrowing environment, a particular problem for AI investment where the payback period remains uncertain. Renewed U.S.-Iran tensions added to Tuesday's bond pressure by keeping oil elevated and inflation concerns alive, but the rise in long-term yields predates Tuesday's move.
Is the AI boom pushing up yields?
Janney chief fixed income strategist Guy LeBas argues the rise in yields is not primarily an inflation story. Real yields are climbing across the U.S., Germany and Japan, he says, pointing to a broader increase in the real cost of capital as governments borrow heavily and companies pour money into AI and data-center investment.
Asked by Benzinga how much of the pressure comes from fiscal borrowing versus the AI buildout, LeBas said there is "zero way to distinguish" between them, and that the effects are probably nonlinear.
Amazon, Alphabet, Meta and Oracle issued about $194 billion in bonds through July 7, up 79% from all of 2025, according to Reuters and LSEG data. Joseph Wang, a former senior trader on the New York Fed's Open Market Desk, argued that AI debt does not appear to be literally crowding out Treasuries, noting that dealer coupon holdings do not appear to be building and swap spreads show no sign of balance-sheet stress.
Prediction market traders think rates could climb further. The 10-year Treasury yield stood around 4.73% Tuesday after earlier climbing toward 4.75%. Traders on a Polymarket market tracking the 10-year yield assign about a 77% chance it touches 4.8% before year-end. They put roughly a 37% chance on it reaching 5%.
For AI stocks, the problem may be simpler: capital is getting more expensive, and Tuesday showed the cost.
Source: Benzinga.com
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