Why do yield spikes reflect badly on tech stocks Yield spikes are a reflection of market equity valuation.
How I interpret this is that there’s real fear that some companies in the market won’t be able to pay their debt. Therefore, bonds trade cheap, hence spiking the yield.
Large Tech companies (FANGs) are not going to default on their debt.... so why does yield spikes impact their stock value?
You are referring to recent market events where the yield of US Treasury bonds has risen and some tech stocks have been falling?   My interpretation of this situation is that the rise in yields reflects growing optimism in the broader economy , as we overcome Covid and head back to work.  In the stock market, this leads to a preference for traditional stocks that do well in a ‘normal’ economy, and a rotation away from the tech stocks that did especially well in the pandemic.  This we have a correlation rather than a causation.