Drama on Wall Street: Liquidation of giant positions worth a billion dollars

An event-filled trading day ended on Wall Street with a return to positive territory, as the major indices managed to break a streak of three days of declines. In the background of the gains was a significant turn in the US government bond market, alongside unusual jumps in several stocks, a strengthening of gold and oil, and further drama in the digital currency arena. At the end of trading, the S&P 500 index rose by about 0.4%, while the Dow Jones and Nasdaq added about 0.3% each. At the same time, the VIX volatility index retreated by 5.2% and reached a level of 15 points.

One of the main factors for the change in atmosphere came from the debt market. The US Treasury announced that starting in September, the volume of buybacks of long-term government debt will be significantly expanded. The announcement led to a rise in bond prices and a sharp drop in yields. The yield on the 30-year bond fell by nine basis points and reached 5.194%, the sharpest daily drop recorded since October 2025. This follows earlier this week when the yield climbed to levels not seen since 2007. The 10-year yield retreated to 4.65%.

The reaction was quickly felt in the forex market as well. The DXY dollar index lost 0.7%, and the drop in yields provided support for technology stocks. Tech giant stocks recovered, with Tesla and Amazon standing out with gains. On the other hand, semiconductor stocks remained under pressure and the SOX index weakened, partly against the background of a Bank of America survey that pointed to high trading density in the sector.

But one of the day's biggest dramas came from the pharmaceutical industry. Moderna's stock jumped by an unusual rate after the company and Merck reported positive results in an advanced clinical trial for a personalized cancer vaccine. The experimental vaccine is based on mRNA and is combined with Merck's immunotherapy treatment Keytruda. The trial was conducted among more than 1,100 patients with high-risk or advanced-stage melanoma, after the detectable tumor was removed surgically. Merck's stock also recorded a sharp rise.

The crypto market also provided investors with an unusual day. A rapid upward move in Bitcoin triggered a significant short squeeze and the liquidation of leveraged short positions totaling more than a billion dollars within an hour. Following the wave of forced buying, Bitcoin climbed above the $68,000 level, after at one point even crossing the $69,000 mark. Stocks related to the field, including Coinbase and Robinhood, also enjoyed gains.

The drop in yields and the weakness in the dollar provided a significant boost to gold as well. The price of the precious metal jumped by 3.3% and reached $4,566.7 per ounce, the highest level in 11 weeks. Energy prices also rose during the day, with Brent crude oil trading around levels of more than $91 per barrel. Among other stocks that stood out during trading was Target, which benefited from good reports and an increase in the annual forecast, while La-Z-Boy fell after presenting results and a forecast that disappointed the market. Navios weakened after announcing a convertible bond issuance of $4.5 billion.