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What is the story about?
US stocks opened higher on Wednesday, the final trading day of September, after fresh economic data showed inflation cooled in August, pushing Treasury yields lower and easing some concerns about further Federal Reserve rate hikes.
The Dow Jones Industrial Average rose 53 points, or 0.1%, at the open. The S&P 500 gained 0.4%, while the Nasdaq Composite advanced 0.6%.
The personal consumption expenditures (PCE) price index rose 3.4% year-on-year in August, slowing from 3.7% in July and below economists' expectations for the annual rate to remain at 3.7%.
Core PCE, which excludes food and energy prices, rose 3% from a year earlier, down from 3.3% in July and below economists' forecasts.
The softer inflation reading sent Treasury yields lower. The 10-year Treasury yield retreated from its highest level since 2007 and was last at 5.23%. The 30-year Treasury yield also fell after reaching levels not seen since June 2002.
Higher Treasury yields have weighed on US stocks through September, with the S&P 500 down 0.2% for the month through Tuesday.
Expectations for a Federal Reserve rate hike also eased following the inflation data. The CME Group's FedWatch tool showed traders pricing in a 35% chance of a quarter-point rate hike next month, down from 51% a day earlier.
Traders continued to expect another rate increase in December despite the softer inflation reading.
US stock futures edge lower as investors await inflation data
US stock futures edged lower on Wednesday (September 30) as investors kept an eye on elevated Treasury yields and waited for the latest inflation data for clues on the Federal Reserve’s interest-rate outlook.
Futures tied to the Dow Jones Industrial Average were little changed, while S&P 500 futures and Nasdaq-100 futures slipped slightly.
The cautious start came after all three major US indexes ended lower in the previous session.
Treasury yields remain high
Treasury yields eased slightly on Wednesday after surging in the previous session.
The 30-year Treasury yield had climbed to its highest level since June 2002 on Tuesday, while the 10-year yield rose to a fresh 2007 high near 5.3%.
Higher yields can put pressure on stocks by making bonds more attractive and raising borrowing costs for companies.
The Dow fell more than 100 points on Tuesday, while the S&P 500 and Nasdaq Composite declined 0.2% and 0.1%, respectively.
European markets
European stocks traded mostly higher in morning trading.
The pan-European Stoxx 600 rose 0.1%. The UK’s FTSE 100 and Italy’s FTSE MIB gained 0.76% each, while Germany’s DAX advanced 0.63% and France’s CAC 40 added 0.23%.
Asian markets
Asian markets were mixed.
Japan’s Nikkei 225 gained 1.94%, while South Korea’s Kospi fell 0.48%.
Australia’s S&P/ASX 200 rose 0.92%, while mainland China’s CSI 300 ended 0.29% higher.
Also Read: Donald Trump asks Anthropic CEO Dario Amodei to ‘be careful’ during media interaction on AI safety | Watch
The Dow Jones Industrial Average rose 53 points, or 0.1%, at the open. The S&P 500 gained 0.4%, while the Nasdaq Composite advanced 0.6%.
The personal consumption expenditures (PCE) price index rose 3.4% year-on-year in August, slowing from 3.7% in July and below economists' expectations for the annual rate to remain at 3.7%.
Core PCE, which excludes food and energy prices, rose 3% from a year earlier, down from 3.3% in July and below economists' forecasts.
The softer inflation reading sent Treasury yields lower. The 10-year Treasury yield retreated from its highest level since 2007 and was last at 5.23%. The 30-year Treasury yield also fell after reaching levels not seen since June 2002.
Higher Treasury yields have weighed on US stocks through September, with the S&P 500 down 0.2% for the month through Tuesday.
Expectations for a Federal Reserve rate hike also eased following the inflation data. The CME Group's FedWatch tool showed traders pricing in a 35% chance of a quarter-point rate hike next month, down from 51% a day earlier.
Traders continued to expect another rate increase in December despite the softer inflation reading.
US stock futures edge lower as investors await inflation data
US stock futures edged lower on Wednesday (September 30) as investors kept an eye on elevated Treasury yields and waited for the latest inflation data for clues on the Federal Reserve’s interest-rate outlook.
Futures tied to the Dow Jones Industrial Average were little changed, while S&P 500 futures and Nasdaq-100 futures slipped slightly.
The cautious start came after all three major US indexes ended lower in the previous session.
Treasury yields remain high
Treasury yields eased slightly on Wednesday after surging in the previous session.
The 30-year Treasury yield had climbed to its highest level since June 2002 on Tuesday, while the 10-year yield rose to a fresh 2007 high near 5.3%.
Higher yields can put pressure on stocks by making bonds more attractive and raising borrowing costs for companies.
The Dow fell more than 100 points on Tuesday, while the S&P 500 and Nasdaq Composite declined 0.2% and 0.1%, respectively.
European markets
European stocks traded mostly higher in morning trading.
The pan-European Stoxx 600 rose 0.1%. The UK’s FTSE 100 and Italy’s FTSE MIB gained 0.76% each, while Germany’s DAX advanced 0.63% and France’s CAC 40 added 0.23%.
Asian markets
Asian markets were mixed.
Japan’s Nikkei 225 gained 1.94%, while South Korea’s Kospi fell 0.48%.
Australia’s S&P/ASX 200 rose 0.92%, while mainland China’s CSI 300 ended 0.29% higher.
Also Read: Donald Trump asks Anthropic CEO Dario Amodei to ‘be careful’ during media interaction on AI safety | Watch
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