Newsletter — week of August 17, 2026

Market performance

The S&P 500 ends the week down 2.12%, putting an end to three straight weeks of gains and records. After hitting new all-time highs the previous week, the index came under growing pressure from the rise in long-term U.S. government bond yields and Walmart’s disappointing results on Thursday. A slight bounce came on Wednesday thanks to a surprise intervention by the U.S. Treasury in the bond market, but that effect quickly faded the next day.

Below, the S&P 500 in 2026

Market news

The bond market takes center stage

Long-term U.S. yields hit levels not seen in nearly twenty years this week, with the 30-year yield climbing as high as 5.33%, its highest since 2007. Faced with this pressure, the U.S. Treasury surprised markets on Wednesday by announcing it would double the size of its long-dated debt buyback operations, from $2 billion to at least $4 billion per operation. This measure acts mainly as a political signal rather than a lasting solution, just as U.S. public debt has topped $40 trillion for the first time. The idea is to show that the administration won’t let long-term rates run away, in order to reassure the markets.

Below, U.S. 30-year yields

Iran under economic pressure

President Trump announced on Wednesday the launch of a sanctions campaign he described as « the most devastating ever waged against a country, » threatening severe economic consequences for any nation that continues to do business with Tehran. This escalation follows on from the U.S. naval blockade of the Strait of Hormuz, which has remained largely closed to oil traffic for several months. Oil reacted sharply to these announcements, with Brent climbing to about $94 a barrel, its highest in a month, adding further inflationary pressure to markets already jittery over rates.

Below, the price of WTI in 2026

Gold benefits from the turmoil

Amid this uncertainty over rates and geopolitics, gold extended its climb for the third straight week, gaining about 3.6% to pass $4,500 an ounce, lifted by a weaker dollar and heightened safe-haven demand against the volatility of bond and currency markets.