10-Year Treasury Yield Falls Below 5% as AI Worries Hit Tech Stocks

The 10-year US Treasury yield fell 19.3 basis points on Thursday, October 22, 2026, closing at 4.953% after 5.146% the day before. A basis point is 0.01 percentage point. It was the largest one-day fall in the 10-year yield since March 10, 2023, the day Silicon Valley Bank failed. Investors sold technology shares and bought government bonds after Meta Platforms' third-quarter report revived doubts about the cost of artificial intelligence (AI).

Bond prices rise when yields fall, so the drop reflects heavy buying of Treasuries. Reuters reported the 10-year yield below 5% for the first time since September 23. Late in the session CNBC put it at 4.945%, and the 2-year yield, which follows expectations for the Federal Reserve most closely, fell 20 basis points to 4.629%. The 30-year yield closed at 5.287%.

What set it off

Meta reported after the close on October 21. Revenue of $64.60 billion beat the $63.37 billion analysts expected, but free cash flow was negative $2.12 billion. Meta raised the bottom of its 2026 capital spending range to $135 billion from $130 billion and kept the top at $145 billion. It also plans a new class of non-voting Class C shares, which it says gives it flexibility to finance growth, and Reuters reported that the plan revived concerns about Meta's growing capital commitments.

The cost of insuring Meta's debt through five-year credit default swaps hit a record on Thursday, and the stock closed at $648.85, down 6.98%. Our earlier article covers Meta's quarter and the Class C plan.

The selling spread to the companies that supply AI hardware. The PHLX Semiconductor Index fell 6.72%, Nvidia fell 4.40% and Broadcom fell 4.31%. Amazon lost 4.57%. The Nasdaq Composite closed down 2.60% and the S&P 500 down 1.21%.

How the day unfolded

1. 09:27:38 ET. A report that Meta's five-year credit default swaps had hit a record reached the MoveSurge news feed before the open. Meta went from $676.50 to $652.23 in the next ten minutes, a 3.59% drop that includes the opening trade.
2. 11:16 ET. Reports said Treasury yields were falling sharply as worries about the AI boom returned.
3. 12:22 ET. The 10-year yield dropped below 5%, and technology shares extended their losses. Nvidia went from $213.99 to $213.36 (-0.29%) in the ten minutes after that headline, so the decline built through the session rather than in one burst.
4. Close. The 10-year yield ended at 4.953%, its lowest close since September 17.

Why bond yields fall when AI stocks drop

When investors sell stocks, much of the cash goes into Treasuries, and Sage Advisory's Thomas Urano called Thursday's move a "flight to quality," according to Finimize. The outlook for the economy pushed yields the same way: Finimize reported that worries AI spending could cool, taking growth with it, began to outweigh data still pointing to persistent inflation.

Slower growth means less pressure on the Federal Reserve to raise rates. CME Group's FedWatch tool put the chance of at least a quarter-point rate rise at the Fed's October 27-28 meeting at 10.5%, down from 27.7% a week earlier, according to Finimize.

Oil rose and yields still fell

Brent crude rose 3.83% to $112.99 a barrel. Reuters reported earlier in the day that Brent was at its highest level since May after further Houthi attacks in Saudi Arabia. Higher oil usually lifts bond yields because it feeds inflation, and on Thursday the move out of stocks outweighed it. France went the other way: its 10-year yield rose and moved above the US 10-year for the first time since 2013, as we reported earlier on Thursday.

The 10-year yield's run above 5%

The 10-year yield had closed above 5% on every trading day from September 23 to October 21. Thursday's close ended that run.