Treasury yields reversed Wednesday’s decline after the US Treasury announced plans to at least double buybacks of 10-, 20- and 30-year debt over the coming months. The move comes after the 30-year Treasury yield hit its highest level in nearly two decades earlier this week.
Higher borrowing costs, along with rising oil prices, pressured equities. Brent crude traded near $94 a barrel, while US West Texas Intermediate (WTI) crude rose to around $86 a barrel, after President Donald Trump vowed to increase economic pressure on Iran.
Among individual stocks, Walmart fell nearly 8% after the retailer reported a slowdown in US sales growth in its latest quarter.
US stock markets today: Dow futures slip after Treasury bond buyback plan; Oil prices rise
US stock futures were largely steady early Thursday, August 20, after Wall Street snapped a three-session losing streak in the previous session, with easing Treasury yields providing some relief to investors.
Futures tied to the S&P 500 were little changed, while Nasdaq-100 futures rose 0.33%. Dow Jones Industrial Average futures slipped over 100 points, or 0.2%.
The S&P 500, Dow Jones and Nasdaq Composite all ended higher on Wednesday as a pullback in longer-dated US Treasury yields helped ease pressure on equities. The S&P 500 snapped a three-session decline after the Treasury Department announced plans to more than double its purchases of 10-, 20- and 30-year debt over the coming months.
The move came after a sharp sell-off in the bond market pushed the 30-year Treasury yield to its highest level in nearly two decades earlier this week. The prospect of increased Treasury demand for longer-dated bonds helped yields retreat, supporting risk appetite across financial markets.
Walmart beat Wall Street expectations in the latest quarter, with revenue rising nearly 6% to $187.9 billion and adjusted earnings per share of $0.81, prompting the retailer to raise its full-year guidance. However, the stock fell 6% in premarket trading after US same-store sales growth slowed to 2.6%, missing analysts’ 3.7% forecast.
The slowdown was largely driven by weaker pharmacy sales following lower drug prices under Medicare pricing reforms. Excluding the health and wellness segment, Walmart’s core merchandise business delivered a stronger 3.4% same-store sales growth, indicating resilient consumer demand.
What is happening in the oil and gas markets
Oil prices remained a key focus for investors on Thursday, with Brent crude futures for October delivery rising more than 2% to nearly $94 a barrel. Higher energy prices have renewed concerns over inflation and could complicate the outlook for interest rates.
European natural gas prices also climbed, with benchmark prices hitting €65 per megawatt-hour for the first time since March, adding to concerns about higher energy costs and inflationary pressures across the region.
How are European markets performing
European stocks opened broadly flat on Thursday, with higher energy prices weighing on sentiment even as easing bond yields provided some support. The pan-European Stoxx 600 slipped marginally shortly after the open.
Travel and leisure stocks were among the biggest decliners, with the sector down nearly 1%. InterContinental Hotels Group and Deutsche Lufthansa each fell around 1%.
Germany’s DAX was among the weakest major regional benchmarks. German borrowing costs had climbed to a 15-year high earlier this week amid expectations of increased defence spending, reflecting a broader rise in bond yields across major economies.
How did Asian markets perform
Most major Asian stock markets ended higher on Thursday as regional bond yields eased from recent highs. South Korea’s Kospi led gains, rising nearly 6% and snapping a two-session losing streak, helped by strong performances from index heavyweights.
SK Hynix surged nearly 13% after announcing plans to buy back and fully cancel shares worth $28 billion.
Japan’s Nikkei 225 and broader Topix gained more than 1% as Japanese bond yields eased after touching their highest levels in three decades earlier this week. The moves followed a retreat in US Treasury yields and gains on Wall Street.
Singapore’s FTSE Straits Times Index was the only major Asian benchmark to finish lower.
What are investors watching today
Investors will focus on weekly US jobless claims due later Thursday. Economists surveyed by Dow Jones expect initial claims for the week ended August 15 to total 210,000.
Bitcoin also remained in focus after approaching the $70,000 level in the previous session, its highest since June. The rally triggered roughly $1 billion in short-position liquidations, according to Bloomberg.
