Shares of several companies in the semiconductor sector, including Advanced Micro Devices, Inc. (NASDAQ:AMD), NVIDIA Corporation (NASDAQ:NVDA) and Taiwan Semiconductor Mfg. Co. Ltd. (NYSE:TSM), are all trading lower amid a rise in U.S. Treasury yields as investors continue to weigh the Federal Reserve's rate hike outlook. A more aggressive rate hike approach to curb inflation could weigh on growth stocks.
Some analysts have also recently expressed concerns of slowing end markets, including PCs.
The 10-year U.S. Treasury yield is hovering around a new two-year high, which has pressured valuations in 2022. The 10-year Treasury yield hit an intraday high of 2.660% Wednesday morning before dipping to around the 2.600% level. When interest rates rise, the value of future cash flows is reduced for growth stocks, which in turn lower the value of the stock.
- AMD is trading lower by 2.71% at $103.93
- Nvidia is trading lower by 5.75% at $244.24
- Taiwan Semiconductor is trading lower by 1.18% at $101.29
