Nasdaq 100 Analysis: Tech Stocks Under Pressure as Fed Fears Return

• The Philadelphia Semiconductor Index dropped more than 4% as rising yields made bonds more attractive relative to growth stocks and increased borrowing costs
• Traders now price in over 40% probability of a 25-basis-point Fed rate hike in January 2026, up from near zero a month ago, following hotter-than-expected inflation data
• Spot Brent crude rose 1.4% despite temporary Iranian oil sanction waiver proposals, keeping inflation concerns elevated alongside bond market repricing

Market Summary: Nasdaq Under Pressure from Rising Yields and Inflation Concerns

Key Market Movements

The Nasdaq Composite fell 177 points (-0.68%) to close at 26,048 on May 18, 2026, while the S&P 500 declined 0.26% to 7,389. The Dow Jones managed a modest 0.09% gain to 49,571. The Philadelphia Semiconductor Index led losses, dropping over 4% as high-growth tech stocks and AI leaders bore the brunt of selling pressure.

Primary Drivers

The 10-Year U.S. Treasury yield climbed to 4.63%, its highest level since February 2025, making bonds more attractive relative to equities and increasing borrowing costs. Spot Brent crude oil rose 1.4% amid ongoing Iran sanction uncertainty, fueling inflation concerns.

The combination of elevated energy prices and rising bond yields has revived Fed rate hike speculation. Traders now price over 40% probability of a 25-basis-point rate increase in January—up from near zero a month ago—following hotter-than-expected inflation data.

Notable Stock Movements

Dominion Energy surged 9.2% following NextEra Energy's $66.8 billion all-stock acquisition announcement; NextEra fell 5.8%. Regeneron dropped 10.2% after its experimental melanoma treatment failed late-stage trials. Nvidia remained in focus ahead of Wednesday earnings, having rallied 36% from March lows.

Technical Outlook

The Nasdaq broke below the 26,223.18 support level, now acting as resistance. Key support levels lie at 25,810.13, 25,599.49, and 25,453.07. A break below the minor bottom at 25,739.22 would disrupt the pattern of higher highs and lows, signaling a potential sentiment shift from a temporary pullback to a more sustained correction.