Negative news keeps coming, and the rising momentum of US tech stocks hits the brakes abruptly.

According to the Zhongtong Finance APP, the momentum of the continuous rise of US technology stocks for 5 months encountered resistance in August, due to the turbulence in the US Treasury market and the weakening of investor optimism caused by the hot employment data.

The Nasdaq 100 index, dominated by technology stocks, fell more than 2% on Wednesday, marking the largest single-day decline in two weeks. Giants such as Apple (AAPL.US), chip manufacturers, and unprofitable technology stocks were sold off. One of the culprits was the surge in US Treasury yields. It is reported that the 10-year Treasury yield rose to 4.12%, the highest level since November last year.

After Fitch unexpectedly downgraded the US sovereign debt rating, US bonds were sold off, and the downward trend of US bonds intensified as the US Treasury Department expanded its quarterly bond issuance. Adding insult to injury for technology stocks, data released by ADP on Wednesday showed that private companies added more jobs last month than expected, once again raising concerns about the need for the Federal Reserve to maintain high interest rates for a longer period of time.

Wednesday's sharp decline temporarily halted the rise of technology stocks, with the Nasdaq 100 index less than 5% away from its all-time high. Last month, driven by the AI boom, the expected price-to-earnings ratio of the Nasdaq 100 index reached its highest level since early 2022.

Quincy Krosby, Chief Global Strategist at LPL Financial, said, "If the 10-year US Treasury yield continues to climb to well above 4% in the coming days due to changes in US ratings, it will force stocks to be repriced on a larger scale, especially technology stocks and growth stocks based on future profit growth."

Here are some technology sectors under pressure:

The NYSE FANG+ index, including giants such as Apple, Microsoft (MSFT.US), and Alphabet (GOOGL.US), fell by as much as 4.3%, the largest decline since July 20.

All 30 constituent stocks of the Philadelphia Semiconductor Index fell on Wednesday, with AMD (AMD.US) leading the decline.

In areas with more speculative trading, the sell-off is more pronounced. The stock prices of a basket of unprofitable technology companies tracked by Goldman Sachs plummeted by 7.2%, marking the largest decline since November 2022.