Wall Street had a rough Tuesday, with rising Treasury yields, higher oil prices, and renewed geopolitical tensions hitting technology stocks hard and pulling several major names lower across the board.

Nvidia and other chip stocks fell roughly 2–3.7% as Treasury yields climbed; Klarna cut its 2026 revenue outlook, sending its shares sharply lower; Home Depot beat earnings estimates with $47.86 billion in second-quarter revenue; oil prices hit three-week highs as U.S.-Iran talks appeared to stall; and Micron gave back Monday's gains with a drop of roughly 6%.

Nvidia and Chip Stocks Slide

Nvidia and the wider semiconductor sector fell sharply as long-term Treasury yields moved higher. The Philadelphia Semiconductor Index, a widely followed benchmark for chipmakers, dropped around 3.7%, while Nvidia declined roughly 2%. Micron, Sandisk, and other AI-related hardware names suffered even steeper losses.

Higher bond yields make future earnings worth less in today's dollars, which puts extra pressure on fast-growing companies with high valuations. Nvidia's processors power most of the large-scale AI systems built in recent years, and it has become one of the world's most valuable companies, so its swings tend to carry outsized weight in broad market indexes. Investors are now focused on Nvidia's August 26 earnings report as the next big test for the AI trade.

Klarna Cuts Its Outlook

Klarna fell sharply after lowering its full-year revenue forecast. The Swedish company, one of the largest players in buy-now-pay-later lending, went public on the New York Stock Exchange in 2025 and has been a closely watched consumer-finance listing since. It now expects 2026 revenue between $4.08 billion and $4.16 billion, down from a prior forecast of around $4.34 billion. Weakness in Germany was cited as a key driver of the reduction.

Second-quarter revenue rose 27% year over year, and Klarna posted an unexpected profit, but investors focused on the weaker forward guidance rather than the current results. Buy-now-pay-later providers depend heavily on consumer spending and credit health, so softness in a major market like Germany feeds quickly into growth expectations. The stock's reaction shows how quickly the market punishes high-growth companies when they trim expectations, even alongside otherwise solid quarterly numbers.

Home Depot Beats Expectations

Home Depot gave investors better news. The retailer, the largest U.S. home-improvement chain and a widely used proxy for consumer spending on housing, reported second-quarter revenue of $47.86 billion, beating Wall Street's estimate of around $47.27 billion. Adjusted earnings of $4.92 per share also came in above expectations.

Comparable U.S. sales rose 1.3%, suggesting consumers are still spending on smaller home repair and maintenance projects despite high mortgage rates keeping the housing market relatively quiet. Many homeowners hold mortgages at rates well below current levels, which discourages moving and the larger renovation projects that often follow a home sale. Investors will watch whether improving economic conditions can lift demand for bigger-ticket remodeling going forward.

Oil Climbs on U.S.-Iran Tensions

Oil prices rose to three-week highs as U.S.-Iran nuclear negotiations appeared to stall, with comments from Iran suggesting a more aggressive military posture adding to investor concern. Iran sits near the Strait of Hormuz, the chokepoint through which roughly a fifth of the world's oil supply passes, which is why tensions there tend to move crude markets.

Higher crude prices raise costs across the economy and can push inflation higher, which could make it harder for the Federal Reserve to cut interest rates. Energy stocks gained on the move, while technology stocks faced added pressure.

Micron Gives Back Monday's Gains

Micron reversed sharply on Tuesday, falling around 6% after ranking among Monday's strongest performers, as rising Treasury yields triggered profit-taking across AI-related stocks.

Micron has benefited from strong demand for high-bandwidth memory (HBM) used in AI data centers. It is one of only three major HBM suppliers, alongside South Korea's SK Hynix and Samsung, and the chips are key components in AI accelerators. That long-term story remains intact, but Tuesday's move underlines how volatile semiconductor stocks can be. Investors are weighing strong structural demand for AI infrastructure against high valuations and rising interest rates.

Source: CoinCentral