Stock Market Update

Equity futures point to a lower opening this morning after the S&P 500 and Nasdaq Composite reached fresh record highs yesterday. Rising Treasury yields and oil prices are creating renewed pressure after stocks received some relief from both fronts to start the week, while mega-cap and technology names are also trading lower in the pre-market.

The rebound in oil comes as geopolitical uncertainty remains elevated. Vice President JD Vance said the U.S. remains in discussions with Iranian officials but that Iran must make meaningful reductions in nuclear enrichment to meet U.S. demands, according to Reuters.

The September FOMC Minutes at 2:00 p.m. ET will be the main item on today's U.S. calendar. Weekly crude oil inventory data are due at 10:30 a.m. ET, followed by August Consumer Credit at 3:00 p.m. ET.

On the U.S. data front:

• 10/03 MBA Mortgage Applications Index -4.2%; prior -6.0%

Today's remaining economic calendar:

• 10:30 AM ET: 10/03 EIA Crude Oil Inventories; prior 0.922M
• 2:00 PM ET: September FOMC Minutes
• 3:00 PM ET: August Consumer Credit; Briefing.com consensus $15.2B; prior $18.1B

In corporate news:

• Constellation Brands (STZ 108.00, -7.67, -6.3%) beat EPS expectations by $0.19, beat on revenue expectations, and reaffirmed its FY27 EPS guidance. The company acquired Spikedade subsequent to the quarter.
• SpaceX (SPCX 168.00, -3.92, -2.3%) is looking to raise $40 billion to purchase Nvidia (NVDA 237.38, -1.86, -0.8%) chips, according to Financial Times. 
• Nikkei reports that Taiwan Semiconductor Manufacturing (TSM 473.20, -9.10, -1.89%) and its peers in Taiwan are increasing artificial intelligence investment in the U.S. and Southeast Asia as global demand grows.

Reviewing overnight developments:

According to Nikkei, Asian markets finished lower as a rebound in oil prices added to inflation concerns and prompted profit-taking after recent gains.

In news:

• Nikkei noted that the Reserve Bank of India raised its policy rate by 25 basis points to 5.50% and maintained its cash reserve ratio at 3.00%.
• Nikkei reported that China's Shanghai Composite remained closed for the National Day holiday and is scheduled to reopen Thursday.

In economic data:

• Japan's August Average Cash Earnings 3.8% yr/yr (expected 3.7%; prior 4.3%) and Overtime Pay 5.2% yr/yr (prior 4.5%); October Reuters Tankan Index 22 (prior 21); August Leading Index 118.0 (expected 118.1; prior 117.7) and Coincident Indicator -1.9% m/m (prior 1.7%)
• Australia's August Building Approvals -6.1% m/m (expected -6.1%; prior -1.9%) and 10.3% yr/yr (expected 10.3%; prior 10.9%); Private House Approvals 3.7% m/m (expected 3.7%; prior -1.9%)
• India's Reserve Bank raised its policy rate by 25 bps to 5.50% (expected 5.50%; prior 5.25%) and maintained the Cash Reserve Ratio at 3.00%

Equity Markets:

• Japan's Nikkei: -0.9%
• Hong Kong's Hang Seng: -0.6%
• China's Shanghai Composite: closed for holiday
• India's Sensex: -0.6%
• South Korea's Kospi: -2.0%
• Australia's All Ordinaries: -0.1%

European markets trade lower with Brent crude back above $100 per barrel amid renewed attacks on shipping in the Strait of Hormuz, adding to inflation and interest-rate concerns.

In news:

• U.K. swaps are pricing more than 100 basis points of Bank of England rate increases by the end of next year.
• France's fiscal outlook remains an additional concern for the region, while Shell indicated that its energy trading division performed strongly during the third quarter.

In economic data:

• Germany's August Industrial Production 2.0% m/m (expected 0.5%; prior -1.2%) and 2.33% yr/yr (prior -1.74%)
• France's August Trade Balance -EUR6.1 bln (expected -EUR6.5 bln; prior -EUR6.6 bln) and Current Account -EUR1.5 bln (prior -EUR3.9 bln)
• U.K.'s September Lloyds House Price Index was unchanged m/m (expected 0.0%; prior -0.3%) and yr/yr (prior -0.4%)

Equity Markets:

• STOXX Europe 600 : -1.0%
• Germany's DAX : -1.4%
• U.K.'s FTSE 100 : -0.8%
• France's CAC 40 : -1.1%
• Italy's FTSE MIB : -2.0%
• Spain's IBEX 35 : -1.6%