Stock futures indicated a downward trajectory on Tuesday, following a conclusion to August where major indexes ended on a negative note despite a winning month, as oil prices and bond yields experienced a notable increase. Futures for the Nasdaq 100, Dow Jones Industrial Average, and S&P 500 indicated declines of 1%, 0.6%, and 0.5%, respectively, in recent trading. Yesterday, the blue-chip Dow, benchmark S&P 500, and tech-focused Nasdaq Composite experienced declines of 0.7%, 0.3%, and 0.1%, respectively, as the new trading week commenced. This downturn coincided with a surge in oil prices following military exchanges between the U.S. and Iran. Nonetheless, they concluded August on a positive note, with the Dow achieving its fifth consecutive month of increases, while the Nasdaq and S&P 500 broke their two-month downward trends.
Crude oil prices experienced an uptick on Tuesday subsequent to President Donald Trump’s remarks on Fox News, where he stated, “we’re going to hit them hard” in response to Iranian strikes on U.S. military bases in Jordan. U.S. benchmark West Texas Intermediate prices rose by 2% to $87.50 a barrel in recent trading, while Brent crude futures, the global benchmark, increased by 1.4% to $91.80. Treasury yields surged further as inflation concerns stemming from the Middle East intensified, alongside indications from Federal Reserve Chair Kevin Warsh last Friday that the central bank is resolute in its efforts to rein in inflation. The yield on the 10-year Treasury note, a key determinant of interest rates across various consumer loans such as mortgages, was recorded at over 4.78% in recent trading. This marks an increase of approximately three basis points from Monday’s close, representing its highest level since mid-January 2025.
Traders currently assign a 66% probability to the Federal Reserve increasing interest rates at its upcoming meeting, a notable rise from approximately 40% just a week prior, according to the CME Group’s FedWatch tool. Before the bell Tuesday, all of the Magnificent Seven mega-cap tech stocks indicated a downward trend, with the Roundhill Magnificent Seven ETF experiencing a decline of approximately 1%. Prior to John Ternus’s first day as CEO after the now-retired Tim Cook’s 15-year tenure, Apple shares were down 0.2%. Tesla, which soared 5.5% yesterday ahead of its expected cybercab unveiling Thursday, pointed 1.2% lower. Amazon declined nearly 1.5% a day after dropping 2.5% as the e-commerce giant was sued by the Federal Trade Commission and 22 states for allegedly concealing “unfair charges in its digital advertising auction pricing.”
Chip stocks experienced a decline in premarket trading. The Roundhill Memory ETF and the broader iShares Semiconductor ETF pointed down roughly 2% and 1.5%, respectively. Shares of Palo Alto Networks and Dell Technologies edged lower ahead of their quarterly results after markets close today. Bitcoin recently was at $78,000, down over the past 24 hours. The U.S. dollar index, which monitors the value of the greenback relative to a selection of foreign currencies, registered an increase of 0.2% at 99.60. Gold futures experienced a decline of 1.3%, settling at $4,425 per ounce. Investor focus will turn tomorrow to Broadcom’s earnings report, while the August jobs report, due Friday morning, is the significant economic indicator of the week.
