December S&P 500 E-Mini futures (ESZ26) are down -0.01%, and December Nasdaq 100 E-Mini futures (NQZ26) are up +0.04% this morning, pointing to a muted open on Wall Street as investors remained on the sidelines ahead of the U.S. job openings report and a series of AI events.
The price of WTI crude reversed earlier gains and turned lower on Tuesday as traders looked for signs of progress in U.S.-Iran peace talks. Treasuries were little changed.
On the AI front, market participants will closely monitor developments from a lunch meeting on safety risks between U.S. President Donald Trump and industry leaders, including Nvidia CEO Jensen Huang, Anthropic CEO Dario Amodei, and Palantir Technologies CEO Alex Karp. OpenAI is also set to hold its annual DevDay developer conference later today, where it is expected to make some major announcements.
In yesterday’s trading session, Wall Street’s main stock indexes ended in the red, pressured by surging Treasury yields. Chip and AI infrastructure stocks slumped, with Arm Holdings (ARM) falling over -8% to lead losers in the Nasdaq 100 and Qualcomm (QCOM) dropping more than -7%. Also, Bloom Energy (BE) sank nearly -9% and was the top percentage loser in the S&P 500 amid concerns about Oracle’s Project Jupiter data center in New Mexico, which was expected to use the company’s gas-powered fuel cells. In addition, MongoDB (MDB) tumbled more than -18% after Meta Platforms tapped its President and CEO Chirantan Desai to head a new business segment. On the bullish side, Nvidia (NVDA) rose over +1% after the chipmaker increased its share buyback authorization by a record $150 billion.
“The broader market hasn’t been able to gain much traction because of rising yields and oil prices. And with the Fed focused on the inflation side of its mandate, unless this week’s labor market data is a major surprise, it will likely play second fiddle to interest rates and energy,” said Chris Larkin at E*Trade from Morgan Stanley.
Fed Governor Lisa Cook said on Monday that future productivity gains from AI may not be sufficient to offset near-term price pressures. She added that the AI build-out is likely to keep upward pressure on inflation in the coming months. Cook also said the central bank’s decision earlier this month to raise interest rates was necessary to tackle elevated inflation, adding that future policy moves would depend on incoming economic data.
U.S. rate futures are currently pricing in a 72.5% probability of a 25-basis-point rate hike and a 27.5% probability of no rate change at the October FOMC meeting.
Today, investors will keep a close eye on U.S. JOLTS job openings data, set to be released in a couple of hours. Economists forecast that August JOLTS job openings will come in at 7.230 million, compared with 7.271 million in July.
The U.S. Conference Board’s consumer confidence index will also be in focus today. Economists expect the board’s consumer confidence index to dip to 89.2 in September from 89.4 in August.
The U.S. S&P/CS HPI Composite - 20 n.s.a. will be released today as well. Economists project the July figure to pick up to +2.2% y/y from +2.1% y/y in June.
In addition, market participants will hear perspectives from Fed Vice Chair for Supervision Michelle Bowman, Fed Governors Michael Barr and Christopher Waller, Chicago Fed President Austan Goolsbee, St. Louis Fed President Alberto Musalem, and New York Fed President John Williams throughout the day.
On the earnings front, cruise operator Carnival (CCL) is scheduled to report its FQ3 results today.
In the bond market, the yield on the benchmark 10-year U.S. Treasury note is at 5.24%, down -0.03%.
The Euro Stoxx 50 Index is up +0.70% this morning, boosted by gains in the tech sector. Chip-related stocks jumped on Tuesday after Anthropic’s IPO prospectus, reviewed by Reuters, laid out an ambitious vision for AI, reigniting enthusiasm for the AI trade. Industrial and mining stocks also climbed. At the same time, construction stocks underperformed, weighed down by declines in Vinci SA and Eiffage SA amid worries about potential tax hikes in France’s 2027 draft budget, which is set to be presented this week. Preliminary data from INE released on Tuesday showed that Spanish inflation rose for an eighth consecutive month in September, reaching its highest level since March 2023. Separately, a survey showed that businesses and consumers across the Eurozone became slightly more pessimistic about the economy in September as elevated energy costs weighed on sentiment. Meanwhile, Eurozone government bond yields fell on Tuesday as the retreat in oil prices eased inflation concerns. European Central Bank President Christine Lagarde said on Monday that, with second-round effects from higher energy costs so far absent, the ECB should take a “measured response as appropriate to keep inflation in check.” In corporate news, Julius Baer (BAER.Z.IX) climbed more than +8% after Swiss financial regulator FINMA concluded enforcement proceedings over private debt loans and client relationships with two “politically exposed” Russian individuals.
Spain’s CPI (preliminary), Eurozone’s Business and Consumer Survey, and Eurozone’s Consumer Confidence data were released today.
The Spanish September CPI rose +4.9% y/y, stronger than expectations of +4.6% y/y.
Eurozone’s September Business and Consumer Survey stood at 97.9, weaker than expectations of 99.0.
Eurozone’s September Consumer Confidence came in at -16.5, in line with expectations.
Asian stock markets today closed mixed. China’s Shanghai Composite Index (SHCOMP) closed up +0.18%, and Japan’s Nikkei 225 Stock Index (NIK) closed down -0.60%.
China’s Shanghai Composite Index closed slightly higher today after the country’s cabinet vowed to step up counter-cyclical policy support to address a deepening economic slowdown. The State Council said in a statement on Monday that it would “put in place a package of practical and effective additional policies” to help achieve this year’s economic goals. The “emerging issues” facing the economy require the government to “step up counter-cyclical adjustments,” it added. “This signals that there will be likely more policy support rollout in the weeks ahead to support the short- and long-term growth targets,” said Lynn Song at ING. Property stocks led the gains on Tuesday after the State Council pledged to study new measures to stabilize the property market. Technology stocks also advanced, rebounding from yesterday’s slump. Investor attention now turns to China’s PMI gauges for September, scheduled for release on Wednesday. Economists expect the official PMI surveys to show improvement in both the manufacturing and services sectors, with the manufacturing gauge expected to climb above the 50 mark, the threshold separating expansion from contraction. The RatingDog PMI surveys, which place greater emphasis on China’s smaller private-sector companies, will also be closely watched. In corporate news, Shein tumbled over -10% in Hong Kong after the fast-fashion retailer’s first earnings report since its listing disappointed investors.
Japan’s Nikkei 225 Stock Index closed lower today as an overnight surge in U.S. Treasury yields to multi-year highs dampened sentiment. Energy, financial, and utility stocks led the declines on Tuesday. Part of the Nikkei’s drop came as companies with March and September fiscal year-ends went ex-dividend. A more than -3% decline in heavyweight SoftBank Group also weighed on the index after shares of U.S.-listed Arm Holdings, in which the tech investor owns a majority stake, slumped overnight. Meanwhile, Japanese government bond yields slipped on Tuesday as oil prices pulled back from session highs and a 40-year government bond auction attracted the strongest demand in six years. On the economic front, data showed on Tuesday that Japan’s July leading economic indicators index, which gauges the economic outlook for a few months ahead based on data such as job offers and consumer sentiment, was revised downward. Elsewhere, Japanese Finance Minister Satsuki Katayama said that the yen’s weakness remains a concern and that Japan and the U.S. will maintain close communication as they work to ensure an orderly currency market. Investor focus this week is on Japan’s third-quarter Tankan survey, which is expected to show sentiment among the country’s largest manufacturers improving to the most optimistic level since December 2017. The BOJ’s summary of opinions from its September meeting will also attract attention. In addition, market participants will closely watch Tokyo core CPI for September, along with industrial production and retail sales figures for August. The Nikkei Volatility Index, which takes into account the implied volatility of Nikkei 225 options, closed up +0.84% to 27.74.
The Japanese July Leading Index was revised downward to 117.7 from the preliminary reading of 118.1.
Pre-Market U.S. Stock Movers
Most chip and AI infrastructure stocks edged higher in pre-market trading, rebounding from yesterday’s selloff. Arm Holdings (ARM), Micron Technology (MU), and Sandisk (SNDK) were all up +1% or more.
You can see more pre-market stock movers here
Today’s U.S. Earnings Spotlight: Tuesday - September 29th
Carnival Corporation (CCL), CarMax (KMX), AAR Corp. (AIR), Uranium Energy (UEC), Concentrix (CNXC).
On the date of publication, Oleksandr Pylypenko did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.