What happened
Shares of MongoDB (MDB +2.28%), a database platform company, were tumbling this morning on no company-specific news. Some investors were likely exiting their MongoDB position as part of a broader sell-off of technology stocks.
MongoDB's stock fell by as much as 6.1% this morning and was down by 5.9% as of 10:19 a.m. EDT.
So what
Tech investors have been keeping a close eye on rising 10-year Treasury yields since September. Rising yields can hurt some of the long-term growth potential of fast-growing tech companies because higher yields mean that a company's future profits are not worth as much right now.
Image source: Getty Images.
The 10-year Treasury yield inched higher today to 1.5%, which is likely the reason why some investors sold MongoDB's shares, and why the tech-heavy Nasdaq Composite was down by 1.4% as of this writing. Last week, the yields reached 1.56%, their highest level since June.
Investors are also generally anxious right now that inflation may be running too far ahead of the Federal Reserve's 2% target.
Now what
While it's not fun to see a stock's price fall 6% in one day, MongoDB investors should remember that today's share price slump has nothing to do with the company's long-term growth potential.
MongoDB shares are still up nearly 90% over the past 12 months and today's fall should be viewed for what it is -- a broader tech sector sell-off in response to rising Treasury yields -- and not an underlying problem with MongoDB's business.
