[BRIEFING.COM] The S&P 500 (-0.3%), Nasdaq Composite (-0.6%), and DJIA (-0.3%) are off to another lower start this morning as the market faces pressure from elevated Treasury yields and oil prices.

Weakness remains pronounced in growth stocks, with mega-cap and tech names weighing on the major averages. Six S&P 500 sectors trade lower, with the information technology sector (-1.1%) posting the widest loss as the PHLX Semiconductor Index slips 1.4%.

Weakness across semiconductor-linked names weighs on the industrials sector (-0.5%), while relative weakness in mega-cap stocks keeps the consumer discretionary sector (-0.5%) lower as well.

Meta Platforms (META 759.72, +15.62, +2.10%) continues to buck the trend, keeping the communication services sector (+0.7%) in positive territory as enthusiasm remains strong about its newly released Muse.

Elsewhere, the defensive health care (+1.2%) and consumer staples (+0.7%) sectors trade higher amid the weakness in growth stocks today, while the energy sector (+1.1%) is supported by higher oil prices.

Just released new home sales increased 6.4% month-over-month in August to a seasonally adjusted annual rate of 684,000 (Briefing.com consensus 610,000) from a revised 643,000 (from 607,000) in July.

The stock market remains poised for a lower opening as elevated oil prices and Treasury yields continue to weigh on sentiment, while semiconductor and mega-cap stocks give back some of their gains from earlier in the week.

Attention will also be on today's meeting between President Trump and Chinese President Xi. The two leaders are scheduled to meet at the White House at 10:00 a.m. ET, followed by a bilateral meeting at 11:30 a.m. ET, with market participants awaiting any developments from the talks.

On the data front, initial claims decreased 1,000 to 197,000 (Brieifng.com consensus: 202,000) for the week ending September 19. Continuing claims increased 2,000 to 1.719 million for the week ending September 12.

The key takeaway from the report is that it shows no change in the understanding that layoff activity is quite low, which is reflective of a generally solid demand environment.

The Q2 Current Account Deficit widened to $246.0 billion (Briefing.com consensus: -$221.0 billion) from an upwardly revised deficit of $212.6 billion (from -$228.6 billion) for Q1.

The S&P 500 futures currently trade 35 points below fair value. 

Equity indices in the Asia-Pacific markets finished mostly lower on Thursday, following course with the U.S. market, which was upset by a spike in Treasury yields. Japan was the notable exception. The Nikkei jumped 0.9%. Japanese technology shares rallied after an extended holiday while Chinese equities came under pressure amid uncertainty surrounding US-China trade talks. Treasury Secretary Bessent said an agreement was made to extend the trade truce for two more months until January 10. Japan's Nikkei 225 gained 0.9%, led by AI and semiconductor names including Ibiden (+14.6%), Advantest (+3.2%), Lasertec (+1.8%), Tokyo Electron (+1.5%), and Murata Manufacturing (+0.8%) following recent strength in global technology shares. China's Shanghai Composite fell 1.2%, while the Shenzhen Component dropped 2.3%, with investors cautious about the duration of the US-China trade truce; Foxconn Industrial Internet (-3.1%), China Life Insurance (-3.0%), and Kweichow Moutai (-1.1%) were among the notable decliners. Hong Kong's Hang Seng Index slipped 0.3% for a second consecutive decline, pressured by rising global bond yields, a stronger dollar, and rebounding oil prices. Tencent (-0.6%), Lenovo (-2.4%), Z.AI (-1.8%), and Genscript Biotech (-4.8%) declined, with technology and growth shares facing renewed pressure from higher borrowing costs. Investors across the region continue to monitor US-China negotiations, along with the inflation implications of higher oil prices and rising bond yields.

• In economic data:
  • Japan's September S&P Global Manufacturing PMI fell to 54.1 from 54.9, below the 55.0 consensus.
  • Japan's September S&P Global Services PMI fell to 51.6 from 52.5.
  • Australia's August unemployment rate increased to 4.6% from 4.5%, above the 4.5% consensus.
  • Australia's employment increased by 39,500 in August, above the 21,500 consensus and following a 15,900 decline in July.
  • Hong Kong's August imports increased 60.0% month-over-month following a 41.0% increase.
  • Hong Kong's August exports increased 53.0% month-over-month following a 50.7% increase.

European markets trade mixed, with elevated oil prices, high bond yields, and uncertainty surrounding US-Iran diplomacy weighing on sentiment. The Swiss National Bank left its key policy rate unchanged at 0.00%, as expected. Germany's DAX 40 is down 0.3%, with BMW (-2.5%), Rheinmetall (-2.5%), Volkswagen (-2.1%), SAP (-1.6%), and Mercedes-Benz (-1.6%) leading losses, while Siemens, Henkel, MTU Aero Engines, and Deutsche Telekom gain more than 1.0%. France's CAC 40 was down as much as 0.8% before rebounding, with BNP Paribas (-3.6%), Stellantis (-1.5%), and STMicroelectronics (-1.3%) under pressure. France's September consumer confidence held at 86, and the manufacturing business climate indicator remained at 101. London's FTSE 100 trades slightly higher, outperforming its continental peers, supported by BP (+1.2%), Shell (+0.8%), Unilever (+0.8%), and British American Tobacco (+1.9%). Halma (+0.2%) edges higher after raising its margin guidance, while Rolls-Royce (-1.0%) and BAE Systems (-0.6%) retreat.

• In economic data:
  • Germany's September Ifo Business Climate Index rose to 89.9 from 88.8, above the 89.1 consensus.
  • France's September consumer confidence held at 86, above the 85 consensus.
  • France's September Business Survey held at 101, below the 102 consensus.
  • Spain's August PPI increased 13.2% year-over-year following a 9.2% increase.

The S&P 500 futures currently trade 42 points below fair value.

Just released, initial jobless claims for the week ending September 19 decreased by 1,000 to 197,000 (Briefing.com consensus: 202,000), fromt the upwardly revised previous level of 198,000 (from 196,000).

Continuing jobless claims for the week ending September 12 increased by 2,000 to 1.719 million, from a downwardly revised previous level of 1.717 million (from 1.730 million).

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

Crude oil is up $1.53 (++1.7%) to $93.70 per barrel as this week's UN session has failed to produce any notable headlines of progress between the U.S. and Iran.

Treasury yields are soaring to multi-year highs in the wake of a bug backup in yields yesterday that pushed stocks lower.

Additionally, the market's expectations of another rate hike continue to increase, with New York Fed President John Williams (voting FOMC member) saying it is reasonable to expect another rate increase this year. The CME FedWatch tool now assigns a 70.9% probability to a rate hike at the October FOMC meeting.

On the trade front, Treasury Secretary Scott Bessent said the U.S. & China agreed to extend the trade truce until January 10, according to Fox News.

There are several economic data releases ahead of the open. Initial and continuing jobless claims and the Q2 current account balance are due at 8:30 a.m. ET, followed by August new home sales at 10:00 a.m. ET.

Today's remaining economic calendar:

• 8:30 AM ET: Q2 Current Account Balance; Briefing.com consensus -$221.0B; prior -$228.6B
• 8:30 AM ET: 09/19 Initial Claims; Briefing.com consensus 202K; prior 196K
• 8:30 AM ET: 09/12 Continuing Claims; prior 1730K
• 10:00 AM ET: August New Home Sales; Briefing.com consensus 610K; prior 607K
• 10:30 AM ET: 09/19 EIA Natural Gas Inventories; prior +44 bcf

In corporate news:

• Alphabet (GOOG 332.75, -2.23, -0.7%) is nearing the release of its Gemini 4 Ai model, according to The Information. 
• Expectations for a new Boeing (BA 199.34, -0.59, -0.3%) aircraft order from China surrounding the Trump-Xi summit have faded, with Boeing instead reportedly focused on finalizing the approximately 200-plane order announced in May.
• Darden Restaurants (DRI 203.48, -10.21, -4.8%) moves lower in the premarket after reporting EPS and revenues in line and reaffirming its FY27b EPS guidance

Reviewing overnight developments:

Asian arkets finished mostly lower, while Japan was the exception as AI and semiconductor shares rallied following an extended holiday, according to Nikkei.

In news:

• Treasury Secretary Bessent said the U.S. and China agreed to extend their trade truce by two months to January 10, though uncertainty about its duration weighed on Chinese equities.
• Higher global bond yields, a stronger dollar, and rebounding oil prices pressured technology and growth shares in Hong Kong.

In economic data:

• Japan's September S&P Global Manufacturing PMI 54.1 (expected 55.0; prior 54.9) and Services PMI 51.6 (prior 52.5)
• Australia's August Unemployment Rate 4.6% (expected 4.5%; prior 4.5%); Employment Change 39,500 (expected 21,500; prior -15,900)
• Hong Kong's August Imports 60.0% m/m (prior 41.0%) and Exports 53.0% m/m (prior 50.7%) --- Equity Markets ---
• Japan's Nikkei: +0.9%
• Hong Kong's Hang Seng: -0.3%
• China's Shanghai Composite: -1.2%
• India's Sensex: -1.7%
• South Korea's Kospi: closed for holiday
• Australia's All Ordinaries: -0.7%

European markets trade mixed as elevated oil prices, high bond yields, and uncertainty surrounding U.S.-Iran diplomacy weigh on sentiment.

In news:

• The Swiss National Bank left its key policy rate unchanged at 0.00%, as expected.
• Energy shares supported the U.K. market, while automakers and technology names weighed on continental markets.

In economic data:

• Germany's September Ifo Business Climate Index 89.9 (expected 89.1; prior 88.8)
• France's September Consumer Confidence 86 (expected 85; prior 86); September Business Survey 101 (expected 102; prior 101)
• Spain's August PPI 13.2% yr/yr (prior 9.2%) --- Equity Markets --- STOXX Europe 600: -0.1%
• Germany's DAX: -0.3%
• U.K.'s FTSE 100: +0.1% Frances's CAC 40: -0.2%
• Italy's FTSE MIB: -0.3%
• Spain's IBEX 35: +0.2%

[BRIEFING.COM] The major averages finished broadly lower on Wednesday as a sharp increase in Treasury yields and another rise in crude oil weighed on the market, while semiconductor and mega-cap growth stocks gave back some of their strong gains from earlier in the week. The S&P 500 (-0.8%), Nasdaq Composite (-1.1%), and DJIA (-0.7%) ended with sizable losses, while weakness was more pronounced in the Russell 2000 (-1.8%). The S&P Mid Cap 400 (-0.6%) held up comparatively well.

Treasury yields were a major source of pressure throughout the session, with selling accelerating after preliminary September PMI data pointed to stronger business activity. The S&P Global U.S. Services PMI increased to 58.7 from 56.5 in August, while the Manufacturing PMI climbed to 57.0 from 53.9. The stronger readings reinforced expectations that additional monetary policy tightening could be needed and helped send yields sharply higher across the curve. Fed Governor Michael Barr (voting FOMC member) added to that pressure by saying his baseline is that further policy adjustments will likely be needed to ensure inflation returns to target in a timely fashion.

Rate-hike expectations moved accordingly, with the probability of a 25-basis-point increase to 4.00-4.25% at the October FOMC meeting rising to 66.4% from 55.4% yesterday, according to the CME FedWatch Tool. Pressure on Treasuries was compounded later in the session by relatively weak dollar demand and foreign participation in the $70 billion 5-year note auction, while the continued rise in crude oil provided another inflation-related headwind. The 2-year note yield climbed 14 basis points to 4.89% after reaching 4.94% intraday, while the 10-year note yield jumped 14 basis points to 5.11% after touching 5.13%.

The rise in rates weighed heavily on some of the market's recent leaders. The PHLX Semiconductor Index fell 1.2% following two exceptional sessions to begin the week, contributing to a 0.7% decline in the information technology sector. Mega-cap growth stocks also pulled back, leaving the Vanguard Mega Cap Growth ETF down 0.9%. Meta Platforms (META 744.10, +7.50, +1.02%) was a notable exception to that weakness, remaining higher amid continued enthusiasm surrounding its Muse AI agent. The stock's gain was not enough to prevent the communication services sector (-1.9%) from finishing among the day's weakest groups, however. Rate-sensitive areas faced some of the most pronounced selling pressure.

The utilities (-1.9%) and real estate (-1.5%) sectors finished sharply lower as Treasury yields surged, while the iShares U.S. Home Construction ETF dropped 2.5%. The consumer discretionary sector (-1.6%) was another notable laggard as higher interest rates and energy costs compounded several stock-specific concerns. Expedia Group (EXPE 259.04, -21.66, -7.72%) and Airbnb (ABNB 149.58, -12.23, -7.56%) suffered sizable losses amid worries that META's Muse AI agent could disrupt established online travel platforms.

McDonald's (MCD 238.35, -12.00, -4.79%) also finished among the day's weaker names after falling to a new 52-week low following the unveiling of its McDonald's > NEXT strategy. Investors reacted negatively to the plan's sizable spending commitments and lengthy timeline as the company contends with slowing U.S. comparable sales and weaker traffic.

Crude oil added another layer of pressure to the broader market, with WTI settling $1.94 higher (+2.1%) at $92.46 per barrel as a U.S.-Iran truce remained elusive. The move provided a clear benefit to energy stocks, leaving the energy sector (+0.9%) as the day's standout performer.

Selling was widespread beneath the major averages, with decliners outpacing advancers by more than 3-to-1 on both the NYSE and Nasdaq. Fewer than half of S&P 500 components are now trading above their 200-day moving averages, underscoring the deterioration in participation even after the strong technology-led start to the week.

Wednesday's retreat ultimately reflected renewed pressure from several of the market's most persistent macro headwinds. Stronger economic data and hawkish Fed commentary pushed Treasury yields sharply higher, rising crude oil added to inflation concerns, and recent semiconductor and mega-cap leaders pulled back. Those pressures extended well beyond technology, with pronounced weakness in small-cap and rate-sensitive stocks contributing to the broad nature of the decline.

• Nasdaq Composite: +15.9% YTD
• Russell 2000: +14.4% YTD
• S&P 500: +12.6% YTD
• S&P Mid Cap 400: +10.5% YTD
• DJIA: +7.2% YTD

Reviewing today's data:

• 09/19 MBA Mortgage Applications Index -1.5%; prior -4.1%
• September S&P Global U.S. Manufacturing PMI - Prelim 57.0; prior 53.9
• September S&P Global U.S. Services PMI - Prelim 58.7; prior 56.5