Equity futures are pointing to a modestly lower start this morning as investors return from a week in which elevated Treasury yields and narrow market leadership remained key influences on the broader market.

Treasury yields remain near multi-decade highs after their rise drove much of last week's action, continuing to present a significant headwind for equities.

The Nasdaq Composite was the only major average to finish last week slightly higher, as strength in mega-cap and technology stocks continued to prop up the major indices despite weaker participation beneath the surface. That divergence was particularly evident in the S&P 500 Equal Weighted Index, which recorded its seventh consecutive losing week, according to FactSet.

Corporate news is relatively quiet to begin the week, leaving the broader macro backdrop as the primary focus in early trading.

On the energy front, Bloomberg reported that Iran increased attacks on ships just as traffic through the Strait of Hormuz returned to pre-war levels, though crude oil is moving modestly lower this morning. Separately, OPEC members reaffirmed their commitment to market stability.

The September ISM Non-Manufacturing Index at 10:00 ET is the main item on today's U.S. economic calendar, preceded by the final S&P Global U.S. Services PMI at 9:45 ET.

Today's economic calendar:

• 9:45 AM ET: September S&P Global U.S. Services PMI - Final; prior 58.7
• 10:00 AM ET: September ISM Non-Manufacturing Index; Briefing.com consensus 55.7; prior 55.4

In corporate news:

• Cerebras Systems (CBRS 174.15, +7.72, +4.64%) moves higher after OpenAI CEO Sam Altman said via X "There is some speculation about our partnership with Cerebras. Cerebras is a close partner, and we have a deep engagement pushing on the frontiers of speed"
• Vaxcyte (PCVX 85.51, +29.03, +51.40%) said its Phase 3 OPUS-1 trial of VAX-31 met all prespecified primary endpoints and showed a similar safety profile to the comparator vaccine.
• PTC (PTC 196.13, +52.10, +36.17%) agreed to be acquired by Schneider Electric for $205 per share in cash, implying a roughly 21 billion enterprise value.

Reviewing overnight developments:

Technology shares drew renewed buying interest in Japan and Hong Kong, according to Nikkei, while markets in China and South Korea were closed for holidays.

In news:

• SoftBank's chief executive highlighted growing artificial-intelligence safety risks and called for international cooperation.
• China's market was closed for the National Day holiday, and South Korea's market was closed for National Foundation Day.

In economic data:

• Japan's September Household Confidence 35.4 (expected 35.3; prior 35.5); September S&P Global Services PMI 51.3 (expected 51.6; prior 52.5) and Composite PMI 52.3 (expected 52.5; prior 53.5)
• Australia's September S&P Global Services PMI 51.9 (expected 51.4; prior 53.2) and Composite PMI 51.3 (expected 50.8; prior 52.7); September MI Inflation Gauge 0.3% m/m (prior 0.5%) ---

Equity Markets:

• Japan's Nikkei: +2.4%
• Hong Kong's Hang Seng: +0.3%
• China's Shanghai Composite: closed for holiday
• India's Sensex: +0.7%
• South Korea's Kospi: closed for holiday
• Australia's All Ordinaries: +0.1%

Elevated bond yields and political uncertainty are weighing on sentiment, while lower oil prices are providing some relief.

In news:

• France's fiscal and political concerns intensified, while Spain's prime minister called a snap election for November 29 after Congress rejected two housing decrees.

In economic data:

• Eurozone's September HCOB Services PMI 53.0 (expected 53.0; prior 51.6) and Composite PMI 53.1 (expected 53.1; prior 52.0); August PPI 1.9% m/m (expected 1.9%; prior 1.6%) and 8.2% yr/yr (expected 8.1%; prior 5.8%); October Sentix Investor Confidence 2.7 (expected 4.5; prior 5.1)
• Germany's September HCOB Services PMI 52.9 (expected 52.9; prior 49.7) and Composite PMI 53.8 (expected 53.8; prior 51.8)
• France's September HCOB Services PMI 51.2 (expected 51.4; prior 48.0) and Composite PMI 51.1 (expected 51.2; prior 48.5)
• Italy's September HCOB Services PMI 51.7 (expected 54.6; prior 55.2) and Composite PMI 51.0 (prior 53.6)
• Spain's September HCOB Services PMI 58.3 (expected 57.1; prior 57.8)
• U.K.'s September S&P Global Services PMI 52.1 (expected 51.7; prior 52.5) and Composite PMI 52.0 (expected 51.7; prior 52.5)

Equity Markets:

• STOXX Europe 600 : +0.3%
• Germany's DAX : flat
• U.K.'s FTSE 100 : +0.3%
• France's CAC 40 : -0.9%
• Italy's FTSE MIB : flat
• Spain's IBEX 35 : +0.5%

[BRIEFING.COM] The major averages finished firmly higher on Friday, holding the bulk of an early advance through a relatively quiet afternoon. The S&P 500 (+0.7%), Nasdaq Composite (+1.2%), and DJIA (+0.5%) all ended with solid gains, while the Russell 2000 (+0.9%) and S&P Mid Cap 400 (+1.0%) outperformed. Despite today's broadly positive finish, only the Nasdaq Composite and S&P Mid Cap 400 ended the week with week-to-date gains.

The session's strongest move came during the morning following the September Employment Situation report, which showed nonfarm payrolls increasing by just 29,000 (Briefing.com consensus 100,000), alongside an uptick in the unemployment rate to 4.2% (Briefing.com consensus 4.1%) and a 0.1% month-over-month increase in average hourly earnings. The softer labor data initially reinforced expectations that the Fed will refrain from another rate hike at this month's FOMC meeting, helping propel the major averages to their session highs during the opening stretch.

That initial momentum faded as Treasury yields reversed their post-jobs-report decline, but the equity market gave back relatively little ground.

Crude oil provided another source of early support after G7 leaders announced a coordinated release of 100 million barrels of oil through the IEA, beginning immediately and extending over four months. WTI crude briefly fell below $90 per barrel before recovering a sizable portion of its decline, ultimately settling $1.92 lower (-2.1%) at $91.10 per barrel.

After settling below their morning highs around midday, the major averages spent most of the afternoon moving in a tight range and ultimately carried solid gains into the close.

Technology and mega-cap growth stocks remained at the forefront of the advance. The information technology sector (+1.1%) finished among the day's leaders, while the PHLX Semiconductor Index gained 2.4%. NVIDIA (NVDA 233.95, +3.09, +1.34%) was among the notable semiconductor winners, and the Vanguard Mega Cap Growth ETF rose 1.0%.

SpaceX (SPCX 158.95, +10.88, +7.35%) was another standout among growth-oriented names, climbing amid favorable analyst commentary regarding demand for its Grok Bot.

Mega-cap strength also helped lift the communication services sector (+0.9%), which finished among the better-performing groups.

The consumer discretionary sector (+1.4%) topped the sector standings, supported by a sizable gain in Tesla (TSLA 370.59, +16.48, +4.65%) after the company reported Q3 deliveries of 486,532 vehicles, above its company-compiled analyst consensus of 461,974. Tesla's strength helped offset a sharp post-earnings decline in NIKE (NKE 33.90, -1.26, -3.57%), which ranked among the worst-performing S&P 500 components and fell to fresh decade lows following a disappointing FY27 outlook.

There was also pronounced divergence elsewhere in the technology landscape. Western Digital (WDC 415.29, -47.27, -10.22%) and Seagate Tech (STX 848.99, -96.58, -10.21%) came under heavy pressure after Toshiba announced an expansion of HDD production in the Philippines, raising concerns that additional industry capacity could eventually loosen the tight supply-demand environment that has supported strong pricing and margins.

The materials sector (+1.0%) was another standout, while all 11 S&P 500 sectors ultimately finished at or above their flat lines.

The health care (flat) and financials (flat) sectors were today's laggards, with continued weakness in biotech names weighing on the health care sector.

Participation was also healthier than the recent pattern of concentrated mega-cap leadership might suggest. The Russell 2000 and S&P Mid Cap 400 both outperformed the S&P 500, and every S&P 500 sector avoided a loss. Still, the S&P 500 Equal Weighted Index (+0.4%) trailed the cap-weighted index (+0.7%), underscoring that technology and mega-cap growth stocks continued to provide an outsized portion of the support.

Ultimately, Friday's session combined stronger participation across small- and mid-cap stocks with continued leadership from technology and mega-cap growth names. The market's ability to preserve most of its early advance despite the reversal in Treasury yields was notable, although the gap between the cap-weighted and Equal-Weight S&P 500 showed that the familiar concentration in the market's largest stocks remained firmly in place.

U.S. Treasuries finished the week with losses across the curve after a brief morning rally gave way to a reversal that lifted yields on longer tenors back to their highest levels of the year. The 2-year note yield settled up three basis points to 4.82% (+4 basis points this week), and the 10-year note yield settled up four basis points to 5.28% (+10 basis points this week). 

• Nasdaq Composite: +17.0% YTD
• Russell 2000: +14.1% YTD
• S&P 500: +12.8% YTD
• S&P Mid Cap 400: +11.0% YTD
• DJIA: +6.5% YTD

Reviewing today's data:

• Sep Nonfarm Payrolls 29K (Briefing.com consensus 100K; Prior 133K revised from 162K)
• Sep Nonfarm Private Payrolls 46K (Briefing.com consensus 100K; Prior 89K revised from 127K)
• Sep Unemployment Rate 4.2% (Briefing.com consensus 4.1%; Prior 4.1%)
• Sep Average Hourly Earnings 0.1% (Briefing.com consensus 0.3%; Prior 0.3%)
• Sep Average Workweek 34.4 (Briefing.com consensus 34.3; Prior 34.4)
• Factory orders increased 0.1% month-over-month in August (Briefing.com consensus: 0.0%) following a downwardly revised 0.8% increase (from 0.9%) in July. Excluding transportation, factory orders increased 0.3% on the heels of a 0.7% increase in July. Shipments of manufactured goods were flat after being up 0.8% in July.
  • The key takeaway from the report is that business spending was up solidly in August, notwithstanding an overall sluggish increase in factory orders.