S&P 500 futures dropped 0.3% early Monday as a jump in oil prices and Treasury yields weighed on Wall Street. Brent crude gained more than 2% after President Trump rejected Iran's conditions for a ceasefire, while the 10-year Treasury yield traded above 5.2%, near multiyear highs.
S&P 500 futures lost 0.3% early Monday, dragged down by rising oil prices and Treasury yields to start the week. Dow Jones Industrial Average futures dropped 238 points, or 0.5%, and Nasdaq-100 futures were 0.5% lower.
Oil and yields weigh on futures
Brent crude traded more than 2% higher at $106.55 a barrel, and West Texas Intermediate futures gained around 2% to $94.46, after Trump rejected conditions for a ceasefire presented by Iran.
At the same time, the benchmark 10-year Treasury note yield traded above 5.2%, while the 30-year bond yield topped 5.5%, both near multiyear highs. The 2-year note yield jumped around 17 basis points over the past week, reflecting bets on further rate hikes from the Federal Reserve.
Rate-hike bets build on persistent inflation
Traders raised their expectations for additional Fed rate hikes as inflation stays persistent alongside higher-for-longer oil prices. Those pressures came even as Wall Street closed out a winning week, when tech and tech-linked names outperformed: Meta Platforms rallied nearly 13% on its Muse AI agent, Microsoft climbed more than 4%, and Apple and Nvidia each advanced more than 1%.
Key data due this week
Rates stay in focus this week as a slew of economic data arrives. The August personal consumption expenditures price index, the Fed's preferred inflation gauge, is due Wednesday. New manufacturing numbers follow Thursday, and the September jobs report arrives Friday.
Source: CNBC
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