U.S. stock futures were mixed in early trading Tuesday, following their strongest session in two months, and major indexes are still on track to post their worst monthly performance of the year due to high interest rates, rising geopolitical risks and weaker-than-expected earnings. of mega-cap technology stocks hold back gains heading into the final months of the year.
However, investors found some relief from the recent rise in Treasury yields late on Monday, and those moves extended into the overnight session, following a lower-than-expected borrowing target of $776 billion. of dollars issued by the Treasury.
That figure, about $76 billion lower than forecasts, came just hours before a Bank of Japan rate decision that included faster inflation forecasts and a wider trading band for Japanese government bonds. , which are unlikely to alter Japan's demand for US Treasuries. investment funds based on
Benchmark 10-year Treasury yields fell 2 basis points in the overnight session to 4.839%, and nearly 20 basis points below the 2007 highs reached last week, while two-year bonds settled at 5,023%.
The US dollar index was down 0.04% against a basket of global peers in early New York trading, at 106.074, although the yen fell the most in two months to 150.3.9 against the dollar and fell to the lowest levels since 2008 against the dollar. the single European currency.
With a more stable rate backdrop, stocks are likely to focus on another S&P 500 earnings parade on Tuesday, including pre-bell updates from Pfizer. (PFE) - Get a free report and caterpillar (CAT) - Get a free report and a report from chipmaker Advanced Micro Devices (amd) - Get a free report after the bell.
With about half of the S&P 500 reporting so far, overall earnings are forecast to rise 4.3% from last year to $478.2 billion stock-weighted, according to LSEG data, before increase another 8.5% during the fourth quarter.
The Federal Reserve also begins its two-day policy meeting today, with its interest rate decision scheduled for 2:00 pm ET on Tuesday. Markets continue to bet that rates will remain stable between 5.25% and 5.5%, and see no more than a 30% chance of a rate increase in the next seven months.
Global oil prices rose in early New York trading as Israel began attacking areas in and around Lebanon in an attempt to neutralize Iran-backed Hezbollah militants while expanding its incursion into Gaza.
Brent crude contracts for December delivery, the global price benchmark, added $1.05 to trade at $88.51 a barrel, while WTI contracts for the same month rose 77 cents to $83.08 a barrel. barrel.
Looking ahead to the start of the trading day on Wall Street, futures contracts linked to the S&P 500 have an opening price gain of 1 point, while those linked to the Dow Jones Industrial Average indicate an advance of 73 points. Futures linked to the Nasdaq foresee a drop of 30 points.
In overseas markets, European shares are on track for their worst monthly performance in more than a year, although the Stoxx 600 rose 0.59% in early trading in Frankfurt amid another busy earnings session.
Overnight in Asia, Japan's Nikkei 225 ended the session up 0.53% following the Bank of Japan's rate decision, while a softer-than-expected reading for factory activity in China, which entered into contraction during the month of October, it maintained the index at the regional level. The MSCI index excluding Japan is down 0.71% heading into the final hours of trading.
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