The S&P 500 futures currently trade 32 points above fair value. 

Equity indices it he Asia-Pacific region had a mostly lower finish to the midweek session with South Korea's Kospi (-0.9%) deepening its reversal from a record high. Samsung's union will launch a strike on Thursday, though management is reportedly still looking to avoid that outcome. The People's Bank of China left its one-year and five-year loan prime rates at their respective 3.00% and 3.50%. Japan sold 20-yr JGBs to solid demand and there was a report that a new JGB aimed at retail investors could be launched. The Reserve Bank of New Zealand's mean household inflation expectations for two years out increased to 4.9% from 3.4%.

• In economic data:
  • Japan's May Reuters Tankan Index 8 (prior 7)

---Equity Markets---

• Japan's Nikkei: -1.2%
• Hong Kong's Hang Seng: -0.6%
• China's Shanghai Composite: -0.2%
• India's Sensex: +0.2%
• South Korea's Kospi: -0.9%
• Australia's ASX All Ordinaries: -1.3%

Major European indices trade in the green, encouraged by news that EU trade negotiator Zovko said that a trade deal has been made with the U.S. European Central Bank policymaker Kocher said that a June rate hike is expected if there is no quick end to the Iran conflict. The U.K. is reportedly lobbying supermarkets to introduce price caps on essential times like eggs, bread, and milk.

• In economic data:
  • Eurozone's April CPI 1.0% m/m (expected 1.0%; last 1.3%); 3.0% yr/yr (expected 3.0%; last 2.6%). April Core CPI 0.9% m/m (expected 0.9%; last 0.8%); 2.2% yr/yr (expected 2.2%; last 2.3%)
  • Germany's April PPI 1.2% m/m (expected 2.0%; last 2.5%); 1.7% yr/yr (expected 1.5%; last -0.2%)
  • U.K.'s April CPI 0.7% m/m (expected 0.9%; prior 0.7%); 2.8% yr/yr (expected 3.0%; last 3.3%). April Input PPI 2.4% m/m (expected 1.2%; last 4.3%); 7.7% yr/yr (expected 5.9%; prior 5.3%). April Output PPI 1.4% m/m (expected 1.0%; prior 1.4%); 4.0% yr/yr (expected 2.8%; prior 3.0%)

---Equity Markets---

• STOXX Europe 600: +0.5%
• Germany's DAX: +0.2%
• U.K.'s FTSE 100: +0.2%
• France's CAC 40: +0.5%
• Italy's FTSE MIB: +0.5%
• Spain's IBEX 35: +0.5%

The S&P 500 futures currently trade 33 points above fair value.

Large chipmaker names are poised for solid opening gains after a stretch of lower finishes as the market looks toward NVIDIA's (NVDA 224.13, +3.52, +1.6%) earnings release after the close.

On a related note, Alibaba (BABA 135.87, +0.23, +0.2%) has unveiled a new AI chip that it says is three times more powerful than its previous model.

Equity futures point to a higher opening as oil prices and Treasury yields move modestly lower this morning.

Stocks are coming off a weak session, which was the third consecutive lower finish for the S&P 500. Mega-cap and other growth stocks lagged, though an intraday rebound across semiconductor names helped the major averages improve considerably from session lows.

The semiconductor cohort will garner additional attention today as investors anticipate NVIDIA's (NVDA 223.60, 2.99, +1.4%) earnings release after the close.

President Trump said yesterday that he hopes the Iran war ends "very quickly", according to The Hill, though reports suggest the U.S. and Iran remain far apart on negotiations. Still, crude oil is currently down $1.85 (-1.8%) to $102.30 per barrel.

Today will once again be light on the data front, though the market will receive the April FOMC meeting minutes this afternoon.

The MBA Mortgage Applications Index for the week ended May 16 decreased 2.3%, from a prior increase of 1.7%.

In corporate news:

• CAVA Group (CAVA 84.10, +5.98, +7.7%) beat EPS expectations by $0.03, beat revenue expectations, saw same restaurant sales increase 9.7%, and raised its FY26 same restaurant sales growth.
• Lowe's (LOW 213.79, -4.58, -2.1%) beat EPS expectations by $0.06, reported revenues in-line, and reaffirmed its FY27 guidance.
• Target (TGT 128.73, +1.49, +1.2%) beat EPS expectations by $0.24, beat revenue expectations, and raised its FY27 guidance.

Reviewing overnight developments:

Equity indices in the Asia-Pacific region had a mostly lower finish to the midweek session with South Korea's Kospi (-0.9%) deepening its reversal from a record high. Japan's Nikkei: -1.2%, Hong Kong's Hang Seng: -0.6%, China's Shanghai Composite: -0.2%, India's Sensex: +0.2%, South Korea's Kospi: -0.9%, Australia's ASX All Ordinaries: -1.3%.

In news:

• Samsung's union will launch a strike on Thursday, though management is reportedly still looking to avoid that outcome.
• The People's Bank of China left its one-year and five-year loan prime rates at their respective 3.00% and 3.50%.
• Japan sold 20-yr JGBs to solid demand and there was a report that a new JGB aimed at retail investors could be launched.
• The Reserve Bank of New Zealand's mean household inflation expectations for two years out increased to 4.9% from 3.4%.

In economic data:

• Japan's May Reuters Tankan Index 8 (prior 7)

Major European indices trade in the green, encouraged by news that EU trade negotiator Zovko said that a trade deal has been made with the U.S. STOXX Europe 600: +0.4%, Germany's DAX: +0.4%, U.K.'s FTSE 100: +0.1%, France's CAC 40: +0.7%, Italy's FTSE MIB: +0.6%, Spain's IBEX 35: +0.6%.

In news:

• European Central Bank policymaker Kocher said that a June rate hike is expected if there is no quick end to the Iran conflict.
• The U.K. is reportedly lobbying supermarkets to introduce price caps on essential times like eggs, bread, and milk.

In economic data:

• Eurozone's April CPI 1.0% m/m (expected 1.0%; last 1.3%); 3.0% yr/yr (expected 3.0%; last 2.6%). April Core CPI 0.9% m/m (expected 0.9%; last 0.8%); 2.2% yr/yr (expected 2.2%; last 2.3%)
• Germany's April PPI 1.2% m/m (expected 2.0%; last 2.5%); 1.7% yr/yr (expected 1.5%; last -0.2%)
• U.K.'s April CPI 0.7% m/m (expected 0.9%; prior 0.7%); 2.8% yr/yr (expected 3.0%; last 3.3%). April Input PPI 2.4% m/m (expected 1.2%; last 4.3%); 7.7% yr/yr (expected 5.9%; prior 5.3%). April Output PPI 1.4% m/m (expected 1.0%; prior 1.4%); 4.0% yr/yr (expected 2.8%; prior 3.0%)

[BRIEFING.COM] The S&P 500 (-0.7%), Nasdaq Composite (-0.8%), and DJIA (-0.7%) finished lower today, pressured by rising yields and weakness across mega-cap stocks.

The communication services (-1.6%) and consumer discretionary (-1.3%) sectors were hindered by weak leadership across their largest components, including Alphabet (GOOG 384.90, -8.21, -2.09%) and Amazon (AMZN 259.34, -5.52, -2.08%). The Vanguard Mega Cap Growth ETF finished 0.9% lower, contributing to losses at the index level.

Notably, the information technology sector (-0.7%) finished with a more modest loss despite early-session weakness. Semiconductor names opened with a continuation of yesterday's decline, though buyers began stepping in late in the morning. The PHLX Semiconductor Index (flat) reversed a significant early drop and climbed as much as 1.5% at its intraday highs, helping the major averages briefly approach their flatlines. Memory names such as Sandisk (SNDK 1383.29, +50.28, +3.77%) and Micron (MU 698.74, +17.20, +2.52%) led the advance, while Intel (INTC 110.80, +2.63, +2.43%) also notched a nice gain.

Session highs did not hold, however, and the major averages finished firmly lower.

Other laggards include the materials sector (-2.3%), which posted the widest loss as nearly all of its components traded lower. Construction materials names such as DuPont (DD 46.56, -2.08, -4.28%) and CRH Plc. (CRH 98.53, -4.86, -4.70%) were among the weakest performers as another rise in Treasury yields pressured rate-sensitive and cyclical areas tied to housing and construction demand.

The iShares U.S. Home Construction ETF finished 1.5% lower.

Builders FirstSource (BLDR 66.39, -3.79, -5.40%) was a notable laggard in the industrials sector (-1.2%), while asset managers, which are sensitive to higher interest rates through their impact on market levels and assets under management, also came under pressure alongside broader weakness in the financials sector (-1.2%).

Meanwhile, strength was concentrated across more defensive holdings. The health care sector (+1.1%) captured a nice gain, with its largest component Eli Lilly (LLY 1021.59, +33.50, +3.39%) rebounding nicely from yesterday's slide, while the utilities sector (+1.0%) captured a similar gain.

The real estate (+0.5%) and consumer staples (+0.4%) sectors notched more modest gains.

The energy sector (+1.0%) finished as one of the top performers as oil reversed earlier losses. The morning was relatively quiet on the geopolitical front, but reports that the U.S. and Iran remain far apart in negotiations began to trickle in later in the session. Crude oil futures settled today's session near their best levels, $0.16 lower (-0.2%) at $108.59 per barrel.

Outside of the S&P 500, the Russell 2000 (-1.0%) and S&P Mid Cap 400 (-1.0%) underperformed amid the weakness in growth stocks and upward pressure on Treasury yields.

Overall, today's session highlighted continued sensitivity to interest rates and mega-cap leadership, with defensive sectors providing stability while growth stocks and cyclicals remained under pressure. Going forward, the market remains focused on whether rising yields will continue to cap upside momentum or whether investors step in with a more meaningful buy-the-dip bid across recent market leaders.

U.S. Treasuries extended their recent losses on Tuesday, lifting yields to fresh highs for the year with the 30-year yield reaching a level not seen in almost 20 years. The 2-year note yield settled up three basis points to 4.12%, the 10-year note yield settled up four basis points to 4.67%, and the 30-year note yield settled up three basis points to 5.18%.

• Nasdaq Composite: +11.3% YTD
• Russell 2000: +10.7% YTD
• S&P Mid Cap 400: +8.0% YTD
• S&P 500: +7.4% YTD
• DJIA: +2.7% YTD

Reviewing today's data:

• Pending Home Sales rose 1.4% month-over-month in April (Briefing.com consensus 1.6%) while the March increase was revised up to 1.7% from 1.5%.