US Stock Futures Fall from Records

US stock indices eased from record highs as higher bond yields rebounded and hampered the earnings projections on debt-sensitive sectors. The S&P 500 and the Nasdaq 100 fell 0.5% and 0.7%, respectively, from their records, and the Dow dropped 1%. Iranian strikes on vessels crossing the Strait of Hormuz worsened soaring shipping premiums faced by tankers in the region and raised the outlook for energy inflation. Long-dated borrowing costs also remained supported by widening federal budget deficits. AI infrastructure stocks erased their gains from earlier this week amid the increasing impact of high yields and credit spreads on their orders, with Micron, AMD, Oracle, Lam Research, and Applied Materials dropping 2%. This was despite positive news for the sector, with SpaceX set to borrow $40 billion to buy Nvidia chips. Nvidia was 1% down and SpaceX fell 3%. Meanwhile, pharmaceuticals and consumer staple companies were higher.

US equity futures fell from record highs as a rebound in bond yields reignited concerns that higher borrowing costs would dent economic activity. Contracts for the S&P 500 and the Nasdaq fell 0.5% and 0.8% from their peaks, while Dow futures were down 0.7%. Iranian strikes on vessels crossing the Strait of Hormuz worsened soaring shipping premiums faced by tankers in the region and raised the outlook for energy inflation. Long-dated borrowing costs also remained supported by widening federal budget deficits. AI infrastructure stocks erased their gains from earlier this week amid the increasing impact of high yields and credit spreads on their orders, with Micron, AMD, Oracle, Lam Research, and Applied Materials dropping 2%. This was despite positive news for the sector, with SpaceX set to borrow $40 billion to buy Nvidia chips. Nvidia was 1% down and SpaceX fell 3%. Meanwhile, pharmaceuticals and consumer staple companies were higher.

US stock futures were little changed on Wednesday after the major averages reached fresh record highs in the previous session, supported by a strong rally in technology stocks. During regular trading on Tuesday, the S&P 500 and Nasdaq Composite advanced 0.58% and 0.45%, respectively, with both indexes closing at record levels. The Dow also climbed 0.49%. Chipmakers were among the strongest performers, led by AMD (2.8%), Marvell Technology (5.8%) and Broadcom (3.7%). Sentiment was further supported as the rise in bond yields paused, easing pressure on the tech sector’s credit outlook. Meanwhile, oil prices recovered as ongoing risks to Middle East energy flows outweighed signs of improving regional supply. Investors now await minutes from the Federal Reserve’s latest meeting for further clues on the outlook for monetary policy.