Trading Day: Tech, tariffs & Treasuries

U.S. bond yields declined and technology stocks suffered on Wall Street Monday, as investors reacted to a flurry of economic data and policy decisions emanating from Washington. Treasury Secretary Scott Bessent's initiatives to bolster bond markets through increased purchase of long-dated bonds have drawn criticism, as his efforts appear to be falling short of his stated goals of reducing the deficit and lowering bond yields.

Meanwhile, President Trump has escalated tensions with Canada by threatening to impose a 50% tariff on certain Canadian goods, including automobiles and auto parts, unless a trade agreement is reached by January 1, 2023. Canada has retaliated with dollar-for-dollar tariffs on U.S. steel, electronics, and other products, set to take effect on September 8.

The Federal Reserve Chair, Kevin Warsh, is set to deliver a keynote address at the Kansas City Fed's annual Jackson Hole symposium, where he aims to revamp the Federal Reserve's communication strategy. However, Warsh's recent approach to bond yields has raised questions about his commitment to the 2% inflation goal and his willingness to resist President Trump's calls for lower interest rates.