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Week ending Friday, August 21, 2026
Washington spent the week trying to talk the long end of the Treasury curve lower while crude and the Fed's own minutes leaned the other way, and by Friday the bond market had handed back almost everything the Treasury had bought it.
The averages all lost ground. The S&P 500 fell 1.4% to 7,674.31, ending a three-week winning run and finishing 1.6% below the record close of 7,798.99 it cut on August 13. The Nasdaq Composite took the worst of it, down 2.1% to 26,180.46, with the chip complex under pressure for most of the week. The Dow Jones Industrial Average held up best, off 0.8% to 53,276.81, and that was only after a 517.60 point rally on Friday. The Russell 2000 slipped 1.4% to 3,018.81, one week after closing at a record.
Energy and the long bond did the damage. WTI crude settled at $86.72 a barrel, up 5.3% and its second straight weekly gain, with Brent finishing near $93.87, as Washington readied a sanctions package meant to cut Iran off from the world's payment system. Gold ran to $4,626.60 an ounce, better than 4% higher on the week and its best level since mid-May, bid on the geopolitics and on the growing sense that the Treasury has started managing its own borrowing costs. The 10-year Treasury yield closed at 4.74%, up from 4.696% the prior Friday, after the 30-year touched 5.327% on Monday, the highest since 2007. The VIX finished at 15.08 against 14.25 a week earlier, a strangely calm reading for a week that contained a 703 point day in the Dow.
Bitcoin was the odd asset out, clearing $77,000 on Friday for its best week in two years, running on the same fiscal anxiety that lifted gold.
"I used to think that if there was reincarnation, I wanted to come back as the president or the pope or as a .400 baseball hitter. But now I would like to come back as the bond market. You can intimidate everybody." – James Carville
