Investor sentiment was also pressured by rising bond yields, with the benchmark 10-year US Treasury yield moving closer to the 5% mark, reducing the appeal of equities. Meanwhile, oil prices were largely steady as markets weighed the prospects of easing tensions between the US and Iran. Brent crude traded below $100 a barrel, while WTI crude remained under $91. Traders are also closely tracking developments around US-China relations and the potential impact on global growth and trade.
US stock futures muted as oil hovers near $100, mortgage rates top 7%
Earlier, US stock futures were little changed early Wednesday, September 23, as oil prices fluctuated amid continued uncertainty over the war between the US and Iran. At the same time, US mortgage rates climbed above 7% to their highest level since May 2024, adding to the focus on borrowing costs and the interest-rate outlook.S&P 500 futures were marginally higher, while Nasdaq-100 futures slipped 0.1%. Dow Jones Industrial Average futures were down 25 points, or 0.1%. Futures on the major averages pared earlier gains as Brent crude moved higher.
Brent crude futures for November delivery were around 0.4% higher at $99.60 a barrel, while US West Texas Intermediate (WTI) crude futures fell 0.6% to $89.97 a barrel.
Oil prices have remained a key focus for investors as markets assess the possibility of progress in US-Iran talks. President Donald Trump said on Tuesday that US and Iranian officials had met for three hours on the sidelines of the United Nations General Assembly in New York. He also indicated that the US was weighing its options in dealing with Tehran.
The moves in crude are particularly important for markets given their implications for inflation and interest-rate expectations. Brent has remained close to the $100-a-barrel mark despite its recent decline, while traders continue to assess whether a resolution to the conflict could ease pressure on energy prices.
Treasury yields, dollar in focus
US Treasury yields were little changed in early trading, with the 10-year Treasury yield around 4.96%. The dollar, meanwhile, rose for a fourth straight session and reached its highest level since July.
The dollar’s resilience comes even as oil prices have eased from recent highs, with Federal Reserve officials continuing to emphasise caution on monetary policy following last week’s US interest-rate hike.
Federal Reserve Governor Michael Barr and Chicago Fed President Austan Goolsbee are scheduled to speak later on Wednesday, with investors watching for further clues on the central bank’s policy outlook.
US mortgage rates climb above 7%
US mortgage rates climbed above 7% to their highest level since May 2024, according to Bloomberg, adding to the focus on borrowing costs as markets assess the outlook for US interest rates.
The rise in mortgage rates comes as Treasury yields remain elevated following last week’s Federal Reserve rate decision, with markets awaiting further signals from Fed officials on the path for monetary policy.
In Tuesday’s session, the Dow fell 0.4%, while the Nasdaq Composite gained 0.5% for its fourth consecutive positive session. The tech-heavy index touched a fresh all-time intraday high and also closed at a record.
The S&P 500 ended marginally lower and remained around 0.7% below its all-time high.
Investors will also track preliminary September manufacturing and services purchasing managers’ index (PMI) data from S&P Global due later Wednesday. The readings are expected to remain consistent with steady US economic growth.
Also read: MCX gold falls to ₹1.52 lakh per 10 grams, silver also under pressure