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Rising Bond Yields, Oil Prices Pressure Wall Street Pre-Bell; Asia, Europe Off

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Wall Street futures pointed moderately lower pre-bell Thursday as bond yields crept higher, while global crude prices rebounded from recent declines.

In the futures, the S&P 500 fell 0.5%, the Nasdaq declined 0.9%, and the Dow Jones was off 0.2%.

Market observers also await results from a summit between President Donald Trump and Chinese President Xi Jinping, slated to start at the White House in the morning.

West Texas Intermediate crude oil traded up 1.1% at $93.14 a barrel, in pre-market action.

Yields on 10-year US Treasuries reached 5.13%, testing 20-year highs.

The VanEck Semiconductor fund (SMH) traded down 2% pre-bell.

Asian exchanges traded mostly lower overnight, although Tokyo logged a gain after a five-day hiatus.

European bourses edged south at midday on the continent.

MGM Resorts International (MGM) traded down 8.7% pre-bell Thursday after People (PPLI) dropped a bid to acquire the casino operator.

Costco Wholesale (COST) plans to report earnings after the close.

On the economic calendar is the weekly jobless claims bulletin at 8:30 am ET, along with the Q2 US current account, or international balance in goods and services, report.

The August new home sales bulletin files at 10 am, followed by the weekly EIA natural gas release at 10:30 am.

The Kansas City Fed Manufacturing Index for September posts at 11 am.

Federal Reserve Cleveland President Beth Hammack, Philadelphia Fed President Anna Paulson, New York Fed President John Williams and Richmond Fed President Thomas Barkin are slated to speak on Thursday.

In pre-market action, Bitcoin traded at $83,237, and spot gold commanded $4,261 an ounce.

What else is happening in Asia Markets?

Asia Markets

Update: US Equity Indexes Retreat as Blockbuster Private Sector Growth Lifts Treasury Yields, Fed Rate-Increase Bets

(Updates with index/price moves and company/geopolitical news from the first paragraph.)US equity indexes fell after a surge in private-sector growth to the highest in more than five years lifted bets for a back-to-back interest rate increase in October and sent government bond yields sharply higher.The Nasdaq Composite dropped 1.1% to 26,936.04 on Wednesday, retreating from an all-time high. The Dow Jones Industrial Average fell 0.7% to 51,511.59, and the S&P 500 slid 0.7% to 7,706.03. All sectors except energy declined. Communication services, utilities, and consumer discretionary led decliners.US Treasury yields jumped after US private-sector output growth accelerated to a 62-month high in September amid strength in both services and manufacturing, while price pressures intensified. The 10-year yield soared 14.1 basis points to 5.11%, and the two-year rate surged 12.4 basis points to 4.9%.S&P Global's (SPGI) flash purchasing managers' index data released Wednesday showed September's composite output gauge increased to 58.4 from 56 in August, marking a fourth straight monthly rise. The consensus was for 55.3 in a survey compiled by Bloomberg."To put the growth surge in context, barring the spike in demand following the opening up of the economy after the COVID-19 lockdowns, the latest improvement in business activity is the greatest recorded since early 2015," S&P Global Market Intelligence Chief Business Economist Chris Williamson said.Mortgage applications in the US fell last week as a key 30-year rate crossed 7% to reach the highest level in over two years, potentially worsening ongoing affordability challenges. The Mortgage Bankers Association's market composite index, which measures loan application volume, decreased 1.5% sequentially in the week through Sept. 18, the association said.Traders are now pricing a 69% probability that the Federal Reserve will raise its target rate range for federal funds by 25 basis points to 4% to 4.25% in October, up from 55% a day earlier and 9% a month ago, according to the CME FedWatch tool. The Fed raised rates by the same magnitude last week.Iran's President Masoud Pezeshkian told the United Nations that Tehran will not surrender to the pressures being brought on by the US, while saying he is of the view that diplomacy is the way to end the war, Reuters reported Wednesday. This comes as US President Donald Trump warned on Tuesday that he could annihilate Iran if there is no deal to end the war, but also suggested an agreement could come soon, the news report said.US Secretary of State Marco Rubio said that US-Iran mediated talks on the sidelines of the United Nations General Assembly failed to achieve any significant breakthrough, CNN reported Wednesday.The front-month US West Texas Intermediate crude oil contract jumped 2.6% to $92.83 per barrel, and the global benchmark North Sea Brent shot up 4.4% to $103.66 per barrel amid worsening Iran geopolitics.Palo Alto Networks (PANW) shares jumped 5%, the top gainer on the S&P 500 and the Nasdaq, a day after the company launched Unit 42 Continuous Frontier AI Defense, an agentic offensive security service, integrating Anthropic's Claude Mythos 5, OpenAI's GPT-5.6-Cyber, and open-weight models.Paychex (PAYX) shares slumped 8.8%, the steepest drop on the S&P 500 and the Nasdaq, after the company reported fiscal Q1 revenue growth in line with market expectations, while management reiterated its full-year outlook amid a tough comparison in the current quarter.McDonald's (MCD) said Wednesday it will provide $8.5 billion in support to franchisees through 2036 to accelerate restaurant modernization, technology deployment, and operational improvements. Shares dropped 4.8%, the Dow's worst performer.

Dow JonesNasdaq CompositeS&P 500$MCD$PANW$PAYX
Asia Markets

Update: US Equity Indexes Fall in Midday Trading Amid Rising Treasury Yields

(Updates with index/price moves, macroeconomic data, and comments from the first paragraph.)US equity indexes fell after midday Wednesday as oil prices and Treasury yields climbed, while traders tracked the Trump administration's engagement with Iran over a potential peace deal ahead of Chinese President Xi Jinping's visit to Washington.The agenda around Xi Jinping's state visit, which starts later Wednesday, includes extending the US-China trade truce reached last year and AI regulation, Reuters reported Wednesday.The Nasdaq Composite fell 1.1% to 26,951.8. The Dow Jones Industrial Average was down 0.5% to 51,613.8, and the S&P 500 declined 0.6% to 7,716.7. Consumer discretionary and utilities led decliners, while the energy sector led the gainers.The US West Texas Intermediate crude oil contract gained 1.5% to $91.90 per barrel.US Treasury yields rose across the curve intraday, with the 10-year yield climbing to 5.1% and the 30-year rate to 5.4%.US President Donald Trump said after a meeting with British Prime Minister Andy Burnham at the UN General Assembly in New York that Iran and the US had a productive meeting, and a settlement between the two countries is in sight, multiple media outlets reported Tuesday.In economic news, US crude oil stocks, including those in the Strategic Petroleum Reserve, rose by 2.6 million barrels in the week ended Sept. 18, following a decrease of 1.0 million barrels in the previous week.Commercial crude oil stocks, excluding SPR inventories, rose by 3 million barrels following a 600,000-barrel decrease in the week prior, and compared with the 690,000-barrel decline expected in a survey compiled by Bloomberg.Gasoline stocks declined by 1.7 million barrels, compared with the 500,000-barrel increase expected in a Bloomberg survey. Meanwhile, distillate stocks fell by 400,000 barrels in the current week, compared with an expected decrease of 680,000 barrels.The September flash reading of manufacturing conditions from S&P Global climbed to a 52-month high of 57, compared with 53.9 in August and an expected print of 53.7 in a survey compiled by Bloomberg.US mortgage applications fell 1.5% in the week ending Sept. 18, compared with a decline of 4.1% in the previous week, as the 30-year fixed-rate mortgage rate increased to 7.12% from 6.97%.In company news, McDonald's (MCD) said Wednesday it will provide about $8.5 billion in support to franchisees through 2036 to accelerate restaurant modernization, technology deployment, and operational improvements. Unit expansion is expected to contribute nearly 2.5% to systemwide sales growth in 2027 and decline to around 2% by 2030, the company said. Shares of McDonald's fell 5.5% after midday.Microsoft (MSFT) said Wednesday it will invest over $10 billion in cloud and AI infrastructure across the Middle East by 2030. The company also plans to invest more than $400 million in subsea and terrestrial connectivity across the region by 2030. Shares of Microsoft rose 0.3%.UBS Group (UBS) said Wednesday that the Swiss Parliament's Council of States' decision to tighten Swiss capital requirements, if implemented, would be "excessive." The rules would mandate UBS to back foreign participations with 90% common equity Tier 1 capital, or an additional $16 billion of CET1 capital, the company said. UBS shares were down 2.7%.

Dow JonesNasdaq CompositeS&P 500$MCD$MSFT$UBS
Asia Markets

Exchange-Traded Funds, US Equities Decline After Midday

Broad Market IndicatorsBroad-market exchange-traded funds IWM and IVV were lower. Actively traded Invesco QQQ Trust (QQQ) shed 1.2%.US equity indexes fell in midday trading on Wednesday as oil prices and bond yields gained while traders awaited updates on a potential breakthrough in US-Iran relations ahead of Chinese President Xi Jinping's visit to Washington.EnergyIShares US Energy ETF (IYE) and the State Street Energy Select Sector SPDR (XLE) each added about 0.9%.TechnologyThe State Street Technology Select Sector SPDR ETF (XLK) slipped 1%; iShares US Technology ETF (IYW) fell 0.9%, and iShares Expanded Tech Sector ETF (IGM) eased 1%.The State Street SPDR S&P Semiconductor (XSD) was down 2.2%, and iShares Semiconductor (SOXX) was 2.5% lower.FinancialThe State Street Financial Select Sector SPDR (XLF) shed 0.1%. Direxion Daily Financial Bull 3X Shares (FAS) declined 0.5%, and its bearish counterpart, Direxion Daily Financial Bear 3X Shares (FAZ), advanced 0.3%.CommoditiesCrude oil added 1%, and the United States Oil Fund (USO) was up 2.1%. Natural gas gained 1.5%, and the United States Natural Gas Fund (UNG) moved 0.7% lower.Gold on Comex slipped 1.3%, and the State Street SPDR Gold Shares (GLD) was down 1.8%. Silver eased 2.3%, and iShares Silver Trust (SLV) dropped 4.1%.ConsumerThe State Street Consumer Staples Select Sector SPDR (XLP) fell 0.3% and the Vanguard Consumer Staples ETF (VDC) shed 0.4%.The State Street Consumer Discretionary Select Sector SPDR (XLY) was down 1.6%. VanEck Retail ETF (RTH) eased 0.8%, and the State Street SPDR S&P Retail (XRT) dipped 1.2%.HealthcareThe State Street Health Care Select Sector SPDR (XLV) shed 0.8%, while iShares US Healthcare (IYH) and Vanguard Health Care ETF (VHT) fell 1.1% each. IShares Biotechnology ETF (IBB) was down 2.3%.IndustrialThe State Street Industrial Select Sector SPDR (XLI) rose 0.1%. Vanguard Industrials Index Fund (VIS) was up 0.2% and iShares US Industrials (IYJ) was marginally higher.CryptocurrencyIn midday activity, bitcoin (BTC-USD) was 3% lower. Among cryptocurrency ETFs, ProShares Bitcoin ETF (BITO) declined 2.8%, ProShares Ether ETF (EETH) was down 3.3%, and ProShares Bitcoin & Ether Market Cap Weight ETF (BETH) dropped 2.6%.

Dow Jones^EEM^EXI^FAS^FAZ^GLD^IBB^IGM^IGV^IPK^IVV^IWMNasdaq Composite^IYE^IYH^IYJ^IYK^IYW^PMR^QQQ^RTH^SOXXS&P 500^SPY^UNG^USO^VDC^VHT^VIS^XLE^XLF^XLI^XLK^XLP^XLV^XRT^XSD$BETH$BITO$EETH