Dow, S&P 500, Nasdaq Futures Mixed As Long-Term Yields Pull Back From Multi-Decade Highs: APLD, BULL, WOLF, NLST In Focus

• The U.S. 10-year Treasury yield hit a 24-year high of 5.364%, touching its highest level since early 2002, while the U.S. 30-year Treasury bond yield also soared to a 24-year high of 5.7041% on Wednesday.

• Meanwhile, minutes from the Sept. 15–16 FOMC meeting showed that another hike may be on the cards before the end of the year.

• According to data from the CME FedWatch tool, the probability of a 25 bps rate hike in December is at 66%, while the odds of a 50 bps rate hike are at 13.7%.

U.S. stock futures traded mixed in the overnight session late Wednesday, shortly after yields on long-dated U.S. Treasuries retreated from multi-decade highs.

As of 10:22 p.m. EDT, Dow futures were down 0.11%, the S&P 500 futures fell 0.02%, while Nasdaq-100 futures rose 0.05%.

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On Wednesday, all three benchmark indexes closed lower amid pressure from rising bond yields. The Dow Jones Industrial Average led the declines, shedding about 341 points to end the session 0.66% lower. The S&P 500 and the Nasdaq Composite were down 0.22% each at close.

Key US Market Drivers

Long-dated bond yields soared to multi-decade highs on Wednesday, weighing on equity markets.

The U.S. 10-year Treasury yield hit a 24-year high of 5.364%, touching its highest level since early 2002. Meanwhile, the U.S. 30-year Treasury bond yield also soared to a 24-year high of 5.7041%.

Despite the surging yields, long-term bond market bear Jim Bianco, president and macro Strategist at Bianco Research, said that bonds now offer fundamentally appropriate interest-rate levels, making them attractive again after years of being expensive.

Meanwhile, minutes from the Sept. 15-16 Federal Open Market Committee (FOMC) meeting showed that another hike may be on the cards before the end of the year after the central bank voted to raise interest rates by 25 basis points at the September meeting.

“Most participants assessed that another increase in the target range for the federal funds rate would likely be appropriate by year end,” the minutes showed.

The Kobeissi Letter noted in a post on X, “September Fed Meeting Minutes show that most Fed officials expect another interest rate hike by year-end. All 19 Fed officials backed the September interest rate hike. Almost all Fed officials see inflation risks tilted upward, with some warning AI could push demand above supply and increase inflation.”