US stocks opened mixed on Monday, October 5, as investors weighed elevated Treasury yields, lower oil prices and economic uncertainty in Europe, while looking ahead to the Federal Reserve's September meeting minutes and the upcoming third-quarter earnings season.
The Dow Jones Industrial Average fell 0.2% shortly after the open, while the S&P 500 rose 0.2%. The tech-heavy Nasdaq Composite gained 0.4%. US stocks had rallied on Friday after weaker-than-expected jobs data prompted investors to scale back expectations for further Federal Reserve rate hikes.
The benchmark 10-year US Treasury yield rose 2 basis points to 5.30%, hovering near its highest level since 2007. The 30-year Treasury yield climbed 3 basis points to 5.663%. Both yields have risen sharply in recent weeks as investors assess the risk that persistent inflation could keep interest rates higher for longer.
Fed minutes in focusThe Federal Reserve cut its benchmark overnight rate by 25 basis points last month. Investors will get further insight into policymakers' thinking on Wednesday, when the central bank releases minutes from its September meeting. Markets have recently pared back expectations for further rate hikes after a weak US jobs report showed the economy added just 29,000 jobs in September, well below expectations.
Employment growth in previous months was also revised lower. Oil prices fallOil prices declined on Monday, easing some pressure on inflation-sensitive assets. Brent crude futures fell 0.6% to $101.68 a barrel, while West Texas Intermediate crude was down about 1.6% at $89.60 a barrel.
Investors are entering the first full trading week of October with US stocks still close to record levels despite rising borrowing costs. The S&P 500 ended Friday about 1% below its August record high, leaving markets focused on whether earnings and a potentially less hawkish Fed outlook can sustain the rally.
The earnings calendar remains relatively light this week, with results from companies including Levi Strauss, PepsiCo and Delta Air Lines due ahead of the broader third-quarter earnings season later this month. US stock futures edge lower as Treasury yields, oil prices keep investors cautiousUS stock futures edged lower on Monday, October 5, as investors kept an eye on elevated Treasury yields, oil prices and global economic uncertainty, while preparing for the upcoming third-quarter earnings season.
Futures tied to the Dow Jones Industrial Average were up around 0.1%, or 46 points, while S&P 500 futures were little changed. Nasdaq-100 futures slipped more than 0.1%, pointing to a cautious start for technology stocks. The moves come as the benchmark 10-year US Treasury yield held around 5.28%, while the 30-year yield was near 5.63%.
Both yields have climbed to multi-year highs in recent weeks as investors assess the outlook for inflation and the Federal Reserve's interest-rate path. Investors are also monitoring global markets. The euro fell to a 17-month low against the dollar on Monday as political gridlock in France raised concerns over the country's ability to rein in its budget deficit.
The developments triggered a sell-off in French government bonds and supported the US dollar. Quiet economic calendar, earnings season aheadMonday's economic calendar is relatively light, with purchasing managers' index readings from S&P Global and the Institute for Supply Management among the key releases.
Markets will also look ahead to the release of the Federal Reserve's latest meeting minutes later this week for clues on the central bank's policy outlook. On the earnings front, results from Levi Strauss, Applied Digital, PepsiCo and Delta Air Lines are due this week, ahead of the third-quarter earnings season gathering pace in mid-October.