Rising Yields Weigh on Equities as Energy Stabilizes

US index futures are giving back more of their gains from earlier this week as Treasury yields and the US Dollar climb. Energy prices are stabilizing, but overseas equity markets are lower. The US and Iran held talks during the UN General Assembly, with no substantial progress apparent so far.

Overnight flash PMI reports were mixed. Manufacturing activity weakened from last month in Australia, France and Germany, but improved in the UK. Services activity improved in France and Germany, while weakening in Australia and the UK.

NASDAQ and Dow futures are each down 0.3%. The Nikkei is closed for a public holiday, while the Hang Seng is down 1.0%. In Europe, the DAX is down 0.8% and the FTSE is down 0.2%.

Crude Oil is up 0.1%, holding above $90.00/bbl, while Brent Crude is up 1.0% and back above $100.00/bbl. Gasoline is up 2.1% toward $3.55/gallon. Gold is down 0.5% toward $4,350/oz, and Copper is down 0.3% near $6.80/lb.

The US 10-year Treasury yield has returned to 5.00%, and the 30-year yield is above 5.30%. The US Dollar Index is up 0.4%, while the Euro is down 0.4% and the Loonie is down 0.2%.

US flash manufacturing and services PMI reports are due at 9:45 a.m. EDT, with Street expectations of 53.5 and 56.0, respectively. Costco and BlackBerry are scheduled to report earnings after Thursday’s close.

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