U.S. equities advanced on Wednesday as declining long-term Treasury yields lent support to risk assets, following the U.S. Treasury’s announcement to expand buybacks of long-dated bonds.
The 30-year Treasury yield, which had surged the prior session amid inflation concerns, a widening U.S. fiscal deficit, heightened geopolitical risks tied to the Iran conflict, and rising capital demands from major AI firms, reversed course after the Treasury’s plan was disclosed. The yield drop eased pressure on equity valuations, with the Dow Jones Industrial Average up 0.20% at 53,449 points, the Nasdaq 100 down 0.19% at 29,436, and the S&P 500 gaining 0.28% to 7,713.
Biotech stocks led gains after Moderna and Merck & Co reported positive interim results from a Phase 2 melanoma vaccine trial. Moderna’s shares surged 150%, while Merck’s stock climbed 11.6%. BioNTech also advanced roughly 20% in sympathy trading. The rally extended to gold miners, as the gold price rebounded on lower U.S. yields; Agnico Eagle rose 8.5% and Barrick Gold gained nearly 7%.
In corporate developments, Marvell Technology and Alphabet announced an expanded partnership in chip development, including a Marvell option allowing Alphabet to purchase up to $12.2 billion in shares. Marvell’s stock rose 8%, while Alphabet’s shares were little changed. The deal pressured rivals, with Broadcom down more than 4% and other semiconductor names declining.
Estee Lauder shares jumped 17% after the cosmetics company posted better-than-expected quarterly results, underscoring divergent sector performance despite the broader market’s modest gains.
The session’s moves reflected a rotation into areas benefiting from lower borrowing costs and positive corporate news, offsetting broader macro headwinds tied to fiscal strain and geopolitical uncertainty.
