U.S. equity futures are mixed as yesterday’s bond-market relief begins to fade ahead of Walmart earnings and fresh labor data. At 5:52 a.m. ET, Dow futures were down 0.17%, S&P 500 futures were down 0.07% and Nasdaq 100 futures were up 0.04%. The Russell 2000 gained 0.5% Wednesday, but small caps remain particularly sensitive to the renewed rise in long-term yields. The 30-year Treasury is back above 5.21% this morning after the Treasury Department’s surprise buyback announcement produced only temporary relief.
U.S. equities snapped a three-session losing streak Wednesday, with the S&P 500 up 0.2%, the Dow up 0.2%, the Nasdaq up 0.2% and the Russell 2000 up 0.5%. Stocks responded positively after the Treasury said it would double planned long-duration bond buybacks, driving long yields and the dollar sharply lower. Health Care was the major equity catalyst as Moderna and Merck surged on positive late-stage cancer-vaccine results.
Sector performance showed a decisive rotation away from recent AI and cyclical leadership. Health Care surged 3.52%, followed by Consumer Discretionary +2.14%, Materials +1.67%, Consumer Staples +0.79%, Real Estate +0.74% and Communication Services +0.52%. The laggards were Industrials -0.89%, Technology -0.73%, Financials -0.62% and Energy -0.31%, while Utilities was unchanged. Breadth was constructive, with advancers leading 1.76:1 on the NYSE and 1.38:1 on the Nasdaq.
Treasuries rallied sharply Wednesday after the Treasury expanded its long-bond buyback program. The 2-year yield slipped 1 basis point to 4.16%, the 10-year fell 7 basis points to 4.64% and the 30-year dropped 10 basis points to 5.19%. That relief is partially reversing this morning, with the 10-year near 4.67% and the 30-year around 5.22%. The Fed minutes added a counterweight: “several” officials favored a July rate increase and “many” indicated rates may need to rise if inflation fails to return toward 2%, although subsequent softer employment and inflation data have reduced the urgency of a September move.
The DXY plunged 0.86% Wednesday to 98.80, while the euro rose to $1.1678, sterling to $1.3608, and the dollar fell to ¥158.15. The dollar remains weak this morning near a three-month low, with the DXY around 98.7 and the euro near $1.1694.
September WTI crude gained 0.77% Wednesday to $85.59, while December gold surged 3.28% to $4,565.70. Oil is extending higher this morning, with September WTI near $87.67 and Brent above $94, as stalled U.S.-Iran negotiations and restricted Strait of Hormuz flows keep Middle East supply risk elevated. Gold is giving back part of Wednesday’s bond-driven surge, with spot prices down about 0.7% near $4,488, after reaching a two-month high above $4,525 overnight.
Today’s macro calendar includes initial jobless claims and the August Philadelphia Fed Manufacturing Index at 8:30 a.m. ET. Consensus looks for claims around 210,000–212,000, versus 209,000 previously, while the Philly Fed index is expected to moderate toward roughly 25 from 41.4. St. Louis Fed President Alberto Musalem also speaks today, and the Treasury will auction $8 billion of 30-year TIPS later in the session.
Sector Highlights:
Sector performance showed a decisive rotation away from recent AI and cyclical leadership. Health Care surged 3.52%, followed by Consumer Discretionary +2.14%, Materials +1.67%, Consumer Staples +0.79%, Real Estate +0.74% and Communication Services +0.52%. The laggards were Industrials -0.89%, Technology -0.73%, Financials -0.62% and Energy -0.31%, while Utilities was unchanged. Breadth was constructive, with advancers leading 1.76:1 on the NYSE and 1.38:1 on the Nasdaq.
Health Care
- Moderna (MRNA +177% Wednesday) surged after its personalized mRNA melanoma vaccine developed with Merck met its goals in a large late-stage trial. The treatment, combined with Keytruda, significantly reduced cancer recurrence and spread versus Keytruda alone. Merck (MRK +12.5%) rallied on the same results. Moderna is down about 11.4% premarket this morning as investors take profits after Wednesday’s extraordinary move.
Consumer Staples
- Walmart (WMT) reports second-quarter results shortly before the open and is the principal earnings catalyst today. The report will provide the market’s broadest read on household spending after July retail sales unexpectedly declined. Shares were marginally higher premarket ahead of the release.
- Target (TGT +5% Wednesday) raised its annual sales forecast after comparable sales increased 3.8%, ahead of the 2.5% consensus. Traffic rose 3.6% and digital comparable sales increased 8.7%, providing a more constructive consumer read than recent macro retail data.
- Coty (COTY -7.6% premarket) fell after forecasting current-quarter earnings below expectations and withholding full-year guidance.
Consumer Discretionary
- Lowe’s (LOW) lowered its full-year targets after continued weakness in big-ticket DIY projects. Quarterly sales increased 8.4% but missed expectations, while adjusted EPS beat estimates; strength from Pro customers and online sales only partly offset housing-related softness.
Energy
- Chevron (CVX +~1% premarket) and Exxon Mobil (XOM +~1%) are benefiting from crude’s fifth consecutive advance as Middle East supply concerns intensify.
Financials
- Coinbase (COIN +7.5% premarket) rallied after President Trump called on Congress to pass cryptocurrency market-structure legislation.
Information Technology
- Strategy (MSTR +10.5% premarket) also rallied with crypto-linked equities following the White House push for new digital-asset legislation.
- Apple (AAPL -0.2% premarket) and Alphabet (GOOGL -0.2%) were modestly weaker, while Nvidia (NVDA) was slightly higher as the AI trade stabilized despite the renewed rise in long-term Treasury yields.
