U.S. equities are pointing modestly higher Tuesday as lower oil prices and some stabilization in global bond markets offset still-elevated long-term Treasury yields. At roughly 6:15 a.m. ET, Dow futures were up about 0.3%, S&P 500 futures were up 0.1% and Nasdaq 100 futures were up 0.1%. Monday, the S&P 500 gained 0.66%, Nasdaq rose 1.05% to a record close, Dow added 0.18% and Russell 2000 advanced 0.50%. Nvidia, Microsoft, Meta and Tesla helped drive the large-cap advance as investors continued to favor AI-linked growth despite the 10-year Treasury yield remaining above 5.3%.
Monday’s economic data reinforced the market’s core tension between resilient growth and persistent inflation pressure. The ISM Services PMI eased to 54.9 from 55.4, still consistent with solid expansion, while new orders remained strong at 59.8 and the employment index returned to expansion at 50.1. More concerning for rates, the prices-paid index jumped to 74.0, its highest level since July 2022, as companies reported higher fuel, steel, transportation and other input costs. The combination argues against interpreting September’s weak payroll report as evidence that the broader economy is rolling over.
Treasury trading reflected that divergence. The 2-year yield fell 2 basis points to 4.82%, while the 10-year rose 3 basis points to 5.31% and the 30-year gained 3 basis points to 5.66%, further steepening the curve. Long yields briefly pushed to new multi-decade highs overnight but are retreating this morning, with the 10-year near 5.28% and the 30-year around 5.64%. Markets have reduced the probability of an October Fed increase to roughly 22%-24% from more than 70% a week ago, but the long end continues to price fiscal, inflation and Treasury-supply risk independently of the near-term Fed path.
The dollar strengthened Monday, with the DXY rising 0.21 to 102.15. The euro fell 0.37% to $1.1220, sterling declined 0.14% to $1.3221, USD/JPY gained 0.16% to ¥157.98 and EUR/JPY fell 0.20% to ¥177.24. The euro briefly reached a 17-month low as investors remained concerned about French fiscal policy and broader European political instability. The dollar has given back a small portion of those gains this morning as European sovereign yields stabilize.
Commodity markets continue to provide some relief from September’s inflation shock. November WTI fell $1.92, or 2.11%, Monday to $89.19, and is down another roughly 1% this morning near $88.40. Gulf oil shipments excluding Iran have recovered to more than 80% of pre-war levels, while the G7’s planned release of 100 million barrels of emergency reserves has reduced immediate supply fears. December gold gained $3.00, or 0.07%, Monday to $4,165.30 and is modestly firmer this morning as reduced October Fed-hike expectations offset the stronger dollar and high real yields.
Today’s economic calendar includes the August U.S. trade balance and advance goods trade data at 8:30 a.m. ET, with consensus looking for the trade deficit to widen from July’s $88.6 billion. The New York Fed’s Global Supply Chain Pressure Index follows at 10:00 a.m. Fed Vice Chair for Supervision Michelle Bowman speaks at 10:45 a.m. ET on regulation and supervision, while New York Fed President John Williams moderates a discussion at 9:05 a.m.; prepared monetary-policy remarks are not expected from Williams. Wednesday brings the September FOMC minutes, which should provide more detail on the debate surrounding last month’s rate increase and the threshold for additional tightening.
S&P 500 Sector Performance
Monday’s sector performance was broadly positive, with 10 of 11 sectors higher. Materials +1.22% led, followed by Communication Services +1.14%, Energy +0.89%, Health Care +0.75%, Financials +0.73% and Technology +0.72%. The relative laggards were Real Estate -0.44%, Industrials +0.05%, Consumer Discretionary +0.33%, Utilities +0.34% and Consumer Staples +0.64%. Breadth was mixed despite the strong sector count: NYSE breadth was negative 1.06:1 while Nasdaq breadth was positive 1.18:1, suggesting that mega-cap and sector-level strength continued to run somewhat ahead of participation across the full market.
Information Technology
- Nvidia (NVDA) is up roughly 1% premarket after gaining 2.1% Monday to another record close, lifting its market capitalization to approximately $5.76 trillion. Morgan Stanley said Nvidia and Broadcom (AVGO) appear relatively insulated from near-term data-center power constraints because demand for their core AI processors remains stronger than available infrastructure capacity, although delays in data-center deployment could pressure memory, optical and other secondary suppliers.
- PTC (PTC) remains in focus after surging 33% Monday following Schneider Electric’s agreement to acquire the industrial-software company for $205 per share in cash, valuing PTC’s equity at approximately $22.6 billion. The deal underscores continued strategic demand for industrial software and AI-enabled engineering assets even as higher interest rates make large acquisitions more expensive to finance.
Communication Services / Utilities
- Constellation Energy (CEG) is up roughly 3% premarket following a report that Alphabet (GOOGL) is nearing a multiyear agreement worth $1 billion or more to purchase nuclear power from Constellation. The potential agreement would extend the hyperscaler-driven nuclear-power theme as AI data centers require increasingly large amounts of reliable baseload electricity. Constellation has already reached power agreements with Amazon and Microsoft, while Google has pursued nuclear arrangements with other utilities.
Industrials
- Boeing (BA) is in focus after receiving a seven-year contract worth up to $14.7 billion from Lockheed Martin (LMT) to expand production and deliver seekers for PAC-3 Missile Segment Enhancement interceptors. The award follows Boeing’s recent wins on both the Navy’s F/A-XX and Air Force F-47 fighter programs, providing another potential growth driver for a defense business that has historically struggled with fixed-price contract losses.
- C.H. Robinson (CHRW) remains volatile after agreeing to acquire RXO for $5.8 billion in cash and stock. RXO jumped more than 22% Monday while C.H. Robinson fell nearly 11%. Management expects approximately $300 million of annual cost synergies within two years and is using the transaction to expand its truck-brokerage scale and last-mile capabilities.
Health Care
- Becton Dickinson (BDX) is in focus after President Trump said the medical-technology company plans to invest $3 billion in expanded U.S. manufacturing, including more than $1 billion in Nebraska. The investment will increase domestic production of essential medical products and is another example of companies shifting manufacturing capacity toward the U.S. amid changing trade and industrial-policy incentives.
Consumer Staples
- Constellation Brands (STZ) reports fiscal second-quarter results after today’s close, followed by its conference call Wednesday morning. Beer demand, Modelo and Corona volumes, consumer price sensitivity and the company’s fiscal-2027 outlook will be the primary focus following a first quarter in which sales declined but results benefited from resilient beer demand.
- Lamb Weston (LW) reports fiscal first-quarter results before the open, with its conference call scheduled for 9:00 a.m. ET. Restaurant traffic, North American volume, potato costs and pricing will provide another read on food-service demand and consumer spending outside the higher-income segments that have been supporting discretionary spending.
