Treasuries: US bond yields drop as AI rout sparks hunt for safe havens

Amazon.com

30/10/2026 10:29

LONDON, Oct 30 (Reuters) - US Treasuries rallied on Friday, putting yields on track for their biggest monthly fall since late 2023, as a sharp selloff in tech stocks over fears about AI spending pushed investors towards safe-haven assets.
Yields on the benchmark 10-year US Treasury US10YT=RR fell 6 basis points (bps) to 4.925%, on track to fall 36 bps in October,  their biggest monthly drop since December 2023. Yields move inversely to prices.
Futures for the tech-focused Nasdaq index NQcv1 tumbled 2% on Friday after earnings reports from Amazon AMZN.O and Intel INTC.O spooked investors over whether the gargantuan cost of the AI buildout would yield sufficient returns.
Amazon shares dropped 7% in premarket trading after the company reported a sharp cash outflow and another increase in spending. Intel plunged 25% in premarket, meanwhile, after the chipmaker warned it would burn cash this year. 
The reports add to a sour mood in stock markets after Alphabet GOOGL.O shares suffered a record selloff in the previous session, wiping out $500 billion of value as the company's results disappointed investors.
"Treasuries are willing to remain quite responsive to the vagaries of the sentiment on AI valuations and equity market wobbles," said analysts at investment bank ING in a note on Friday.
Two-year Treasury yields US2YT=RR fell 6 bps while 30-year yields US30YT=RR were down 4 bps as US bonds outperformed global peers.
The rally in US Treasuries in recent weeks has halted a sharp selloff that had pushed yields to multi-decade highs as investors fretted about rising energy costs and ballooning government debt.
The 10-year Treasury yield hit its highest since 2002 in early October at 5.365%. The 30-year yield also hit a 24-year high.
Yet Treasuries have recovered as the Nasdaq NQcv1 has fallen 3% in October and the closely watched Philadelphia Semiconductor index .SOX has dropped 9%, highlighting the Treasury market's continuing status as a safe haven.
The drop in yields came despite data on Thursday showing the US economy grew at its fastest pace in a year in the third quarter, while personal consumption expenditures inflation ran hot in September.
Money markets on Friday were pointing to a roughly 75% chance of a Federal Reserve rate hike in December, after the central bank left borrowing costs on hold in the 3.75% to 4.00% range on Wednesday.
     

 (Reporting by Harry Robertson; Editing by Emelia Sithole-Matarise)
 ((harry.robertson@thomsonreuters.com;))