Futures are lower - but well off session lows thanks to some well-time oil sell orders just before US traders walked in to work - as bond yields continue to make new highs, with both Nasdaq and Russell lagging the S&P which feels like more de-risking into tomorrow's Fed release. AS of 8:15am ET, S&P and Nasdaq futures are down 0.1% amid premarket weakness in Mag7 with GOOG / META / MSFT all down at least 90bp but NVDA in the green helping Semis outperform on the move lower.
Memory / Korea names are bid despite Kospi closing lower. Energy, Utils, and pockets of Healthcare are higher with the other sectors weaker pre-market. The yield curve is bear steepening as yields continue to march higher in response to oil/energy and growth.
The 10Y rose as high as 5.04% before retracing back to around 5.0% USD is stronger.
Crude is +2% as the UKR / RU détente on striking energy infra fails to materialize and growing chatter of UK aiding Saudis in fighting the Houthis. Ags are mixed and Metals are weaker, with Base outperforming Precious. Today’s macro data focus is on weekly ADP and Empire Mfg.
In premarket trading, Mag 7 stocks are mostly lower: Nvidia +0.5%, Tesla -0.1%, Amazon -0.
2%, Meta -0.5%, Apple -0.6%, Alphabet -0.
9%, Microsoft -0.9%Cryptocurrency-linked stocks fall on waning optimism that a comprehensive US crypto regulatory bill will progress this week.Dave & Buster’s (PLAY) drops 13% after the restaurant and arcade chain operator reported revenue for the second quarter that missed the average analyst estimate.
Eli Lilly (LLY) is up 1.3% after Berenberg upgraded the pharmaceutical giant, with analysts arguing it’s worthy of a more significant valuation premium due to its superior growth profile and the breadth of its pipeline.Enova International (ENVA) falls 18% after the financial services company withdrew its applications with the Office of the Comptroller of the Currency and the Federal Reserve for the acquisition of Grasshopper Bancorp.
Etsy (ETSY) rises 3% after Oppenheimer upgraded the online retailer to outperform, citing improvements the company is making to its platform.Forgent Power Solutions (FPS) gains 9% after the power equipment company reported fourth-quarter revenue and adjusted Ebitda above a guidance range given in May. The company’s backlog grew 256% year-over-year.
Vera Therapeutics (VERA) jumps 12% after the drugmaker gave updated results from a late-stage trial of its recently approved drug for a kidney disorder.Waystar (WAY), which provides payment-related software to health-care organizations, rises 12% after a Reuters report that said the company is exploring options that include a sale. The report cited sources familiar with the matter.
In other corporate news, Enova International withdrew its bank regulatory applications for the acquisition of Grasshopper Bancorp. Dave & Buster’s shares fell in premarket trading after the restaurant and arcade chain operator reported second quarter results below expectations.Elevated bond yields, which overnight hit a new 19 year high of 5.
04% before reversing, are setting the tone for markets, placing surging energy costs and mounting debt firmly on traders’ radar. Enthusiasm for the AI trade, the major driver of equity gains this year, also remains tempered as debate rages over whether the technology may inflict catastrophic harm. A surprising note from Goldman found that the momentum trade is shifting notably under the surface.
“Of course the bond selloff is weighing on tech and growth stocks,” said Louis Puga at Societe de Gestion Prevoir. “There are really two worlds at play here: on one side healthy corporate balance sheets and profits, and on the other side countries running big deficits and putting pressure on the bond market.”The weakness in bonds raises the stakes ahead of the Federal Reserve’s interest-rate decision on Wednesday, for which money markets are pricing in more than a 90% chance of a hike.
If officials hold off, or Chair Kevin Warsh signals a shallower-than-expected path of tightening, investors may demand even higher yields as protection against inflation.“After years of inflation overshooting target, the Fed’s credibility is under scrutiny,” wrote Jenny Zeng at Allianz Global Investors. Warsh’s “recent comments leave little doubt that restoring price stability remains the priority.
September is the meeting where that commitment is put to the test.”A resilient economic backdrop and cautious investor positioning suggest the equity market can absorb more pressure before the rally comes under threat, Bloomberg proposes. “Being early is the same as being wrong, so I’d be careful not to declare the game over too soon,” Rowe says.
Still, investors are keen to make protective moves: Hedging demand is ticking higher, with three of the four largest VIX trades this year all taking place in the last two weeks.Underneath the AI rhetoric, the picture is more nuanced. Growth won’t suddenly change and adoption and token use remain high, while any move by leading AI developers to slow the frontier could hand an advantage to some of the hyperscalers.
Still, investors are likely to become more selective about picking potential winners. Monday’s chip drawdown was also reflective of positioning: The latest BofA global fund manager survey revealed that long global semiconductor stocks is the single most crowded trade, according to more than half of respondents. The poll also showed fading exuberance around risk assets, with net 49% of managers now overweight global equities compared with 56% last month.
In politics, the Supreme Court refused to clear the Postal Service to enforce new restrictions on mail-in ballots for the midterm elections, rebuffing the Trump administration’s request to intervene. Gavin Newsom said he would not run for president in 2028 if Kamala Harris enters the race, ruling out a potential primary showdown between two of California’s most prominent Democrats.Europe’s Stoxx 600 fell 0.
2%. Deutsche Bank slipped more than 2%, echoing declines among US peers after Bank of America warned that trading revenue for the current quarter will be flat. Regional bonds were mixed.
Here are the biggest movers Tuesday:Kety shares rose as much as 9.7% after the Polish aluminum products and packaging maker agreed to buy Italy’s Metra from KPS Capital PartnersShares in Acciona Energía and parent Acciona advanced after newspaper Expansión reported that EQT and Norges Bank Investment Management have joined forces to bid for the Spanish renewables companyDefense stocks outperformed a struggling broader market on Tuesday morning, with the sector boosted by US inventory shortfalls and news that Japan could raise defense spendingWickes shares rose as much as 9.9%, the biggest intraday gain since May 2025, after the home improvement retailer reported a “significantly improved trend” in the third quarter and said it remains confident it can meet full-year expectationsKier shares rose as much as 4.
8%, the most since July, after the UK infrastructure contractor’s FY26 results showed continued growth in orders and the firm announced it would reallocate capital for property investment toward the balance sheetSchott Pharma climbed as much as 5.5%, the most in almost a month, as JPMorgan initiates at overweight with a Street-high €27.1 price target, citing supportive structural trends and the German pharma packaging company’s market leading roleTrustpilot shares dropped as much as 20%, the most since December 2025, after the online review platform’s results were “noisier than usual” according to JPMorgan analysts, who noted one-off items that impacted the firm’s top-line and lack of a guidance upgradeEuropean lenders declined following US peers weakness after Bank of America’s CEO said trading revenue will be “relatively flat” compared with last year’s third quarterLundbeck shares slid as much as 5.
9%, the most since February, after Deutsche Bank downgraded the pharmaceutical company to sell, noting hea