Nasdaq 100 Under Pressure From Rising Yields, Oil Prices: What to Watch Today

• US equities are facing growing pressure as rising oil prices and bond yields push investors to take profits after three consecutive daily declines.
• The Nasdaq 100 has fallen below 30,000 and 29,850, with 29,180 and 28,190 emerging as the next key support levels.
• Persistent Middle East tensions, elevated energy prices and rising long-term yields could turn the current pullback into a deeper correction if the macro pressure continues.

US index futures were flat by midday London, a day after taking a noticeable dip. In fact, US indices have so far dropped in each of the past three days of this week. We have seen warning signs emerge from and bond markets in recent times, and the pressure has finally gotten too much for equity investors, who have started to respond by taking profits on their long positions.

Yesterday, the futures fell around 1.7%, with other US indices and European markets also lower. The overcrowded AI trade is losing momentum as yields press higher.

The key question is whether this is just a temporary respite before new highs are seen, or whether this marks the beginning of something more meaningful this time. If the rally in oil or bond yields is not stopped, a period of market turmoil cannot be ruled out, even if the odds of a September have fallen with the release of weaker US data lately.

Sentiment Remains Cautious Amid Middle East Tensions

Despite the relative calm this morning, the mood remains cautious. Sustained higher oil prices have revived concerns about inflation, with investors becoming increasingly concerned about the risk of a prolonged disruption to energy markets. For European equities, this is particularly important given their dependency on energy imports. If oil prices continue to climb, the region could face another inflationary shock. But even Wall Street is now coming under pressure.

For now, the situation in the Middle East is showing little sign of easing. President Donald Trump has rejected an extension of the truce, while Iran says the Strait of Hormuz will remain closed until the blockade and oil embargo are lifted. With oil prices remaining elevated and already close to their highs for the year, the message from the energy market is therefore fairly clear:

The risk of a prolonged disruption to energy supplies remains significant – and that could prove to be a problem for overvalued stock markets.

Bond Yields Weigh On Growth Stocks

Meanwhile, rising government bond yields are also adding to a growing list of concerns. Though they were a bit lower at the time of writing, yields remain close to multi-year or multi-decade highs around the world. Higher yields increase the opportunity cost of holding assets that come with high risk and low yields.

For example, growth stocks in the technology sector. And that could become a problem for the likes of the Nasdaq 100, as well as Germany’s , given the European nation’s reliance on imported energy and the big technology stocks that make up the index.

Yesterday, the sell-off in bond markets accelerated, pushing yields even higher across the world, before easing a bit. US yields on the have now risen to 5.337%— its highest level in almost TWO decades. Elsewhere, Japan’s 10-year yield has also moved close to 3%, a level not seen since the mid-1990s, while eurozone yields also remain at multi-year highs.

For equities, the combination of higher energy costs and higher long-term borrowing costs is becoming increasingly uncomfortable.

Nasdaq 100 Technical Analysis

While it is too early to declare the end of the bullish trend, the risks of a correction are rising for the Nasdaq 100. The index has turned lower after again failing to hold sustainably above the 30,000 level. Here, a bearish trend line also offered resistance. With the next support at 29,850ish also taken out, this will now be the first level of resistance to watch in case we see a rebound. The next support is at 29,180ish, a prior resistance level. Below that we could see a more meaningful drop, possibly towards 28,190ish.

With oil prices rising, bond yields climbing and geopolitical risks still elevated, equities may find it increasingly difficult to ignore the pressure coming from the macro environment.

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Disclaimer: This article is written for informational purposes only; it does not constitute a solicitation, offer, advice, counsel or recommendation to invest as such it is not intended to incentivize the purchase of assets in any way. I would like to remind you that any type of asset, is evaluated from multiple perspectives and is highly risky and therefore, any investment decision and the associated risk remains with the investor.

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