Oct 23, 2026 · 28 min
Treasuries regain safe-haven status as AI stocks slide
A big day for equities, but a bigger one for bonds.
The episode separates broad equity weakness from concentrated AI-related selling and tracks the return of bond-led risk protection across markets.
- 1AI and mega-cap weakness drove the equity sell-off, even as nearly twice as many S&P 500 stocks gained as fell.
- 2US Treasuries rallied sharply, briefly reclaiming their safe-haven role as investors reassessed risk.
- 3The bond move spilled into the Japanese yen and broader foreign-exchange markets, extending the episode beyond equities.
Don't miss
US Treasuries rally sharply and briefly reclaim their safe-haven role while AI-linked equities sell off.
The brief
John Hardy opens with a sharp US equity sell-off, but the damage was uneven: AI-related mega-cap names weakened while nearly twice as many S&P 500 stocks gained as fell.
Meta Platforms’ report and changing sentiment around AI investment helped shift the focus from a broad market collapse to a concentrated reassessment of technology leadership.
The bigger move came in US Treasuries, which rallied powerfully as bonds briefly regained their safe-haven role amid the equity turbulence.
That bond rally did not stay confined to the United States: it spilled into the Japanese yen and broader foreign-exchange markets, widening the episode’s significance.
The episode’s central tension is whether investors were rejecting equities broadly or simply repricing the most crowded AI and mega-cap exposures.
What was said on this episode
24 statements · 9 positive · 8 negative · 1 mixed · 6 neutral
Meta’s report shifted market sentiment toward AI investment skepticism.
“It seems that there was quite a vibe shift from the Meta report.”
Listen at 0:11
AI spending skepticism drove the broad sell-off in major AI-related stocks.
“It seems to have been just this overall skepticism on the spend in the AI space.”
Listen at 0:44
The broader market held up better than large-cap technology indices.
“the broader market was in a different place.”
Listen at 1:20
Treasuries rallied sharply despite new highs in oil prices.
“over in treasury land, so in bond land, we're seeing quite a rally, a very stiff one.”
Listen at 2:55
Higher oil prices increasingly signal global growth concerns rather than automatic central-bank hikes.
“the concern more becomes one of the growth rates for global economies than this reflexive, oh, that just means central banks will hike notion.”
Listen at 3:20
Gold fell below the 4,000 price level.
“gold actually tested below the 4,000 level.”
Listen at 4:58
Silver’s next major psychological support level is 50.
“I would argue 50 is the next big psychological level for silver.”
Listen at 5:36
Falling yields and Treasury strength should support the yen.
“the yen finally responding like this is the backdrop that's supposed to really juice the yen.”
Listen at 6:47
Dollar-yen needs to break below 155.25–155 for downside momentum.
“155.25 to 155 area needs to be taken out.”
Listen at 8:38
France’s services sector was contracting according to the flash PMI.
“France, no big surprise seeing some ugly surprises here on the services side, 48.4. So in contraction”
Listen at 10:28
Germany’s manufacturing sector showed improvement in the flash PMI.
“Germany looking quite nice on the manufacturing side.”
Listen at 10:50
The UK economy appeared reasonably strong in the latest flash PMIs.
“UK looking very strong. Well, very strong. Looking reasonably strong here.”
Listen at 11:15
The 5% nominal yield level is important for restoring confidence in French ten-year bonds.
“I still think the 5% nominal level is really important for whether confidence can be found again in the French tenure”
Listen at 12:39
French-German sovereign spreads remain relatively modest.
“the spreads are really not that remarkable yet.”
Listen at 12:58
Near-term concerns about French sovereign spreads may be overextended.
“I think in the super short term here, I'm wondering if this issue is getting ahead of itself a bit.”
Listen at 14:25
Apple reached a new all-time high.
“Apple, by the way, hitting a new all-time high.”
Listen at 19:07
Apple is being rewarded for its limited association with AI spending.
“It is getting rewarded for that now.”
Listen at 19:14
The latest VIX increase was substantially smaller than the October 16 increase.
“The VIX spike was far smaller yesterday than what we saw on October 16th.”
Listen at 20:21
Equities could resume an upturn into year-end if passive investors remain steady.
“perhaps if passive doesn't get shaken, we then just go back to a new market upturn into year end.”
Listen at 20:43
Using poorly defended websites with AI tools can expose personal and financial information.
“it could be very dangerous for your personal information, of course, for your financial information that could result in, well, the use of your credit card, theft of your funds.”
Listen at 24:58
Email accounts outside major services may be less robustly protected.
“if you're operating an email, not on the major services, et cetera.”
Listen at 25:13
Atmospheric CO2 is 15% higher than in 2000.
“we have 15% more CO2 in the atmosphere now than we had in 2000.”
Listen at 26:27
Higher atmospheric CO2 increases available plant food and can boost vegetation.
“CO2 is food for plants, and there's a massive... boost the available food in the atmosphere to vegetation.”
Listen at 26:54
Microsoft, Amazon.com, and Alphabet are among the biggest companies reporting next week.
“The biggest reporting, if memory serves, are Microsoft, Amazon.com, and Alphabet”
Listen at 28:07
Statements are attributed to the speaker as said on the episode and reflect their view at the time, not PodLume's. They are not advice.
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