US stocks: S&P 500, Nasdaq retreat from records as oil and Treasury yields rebound

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Meanwhile, the Dow Jones Industrial Average fell 472.21 points, or 0.92%, to 51,049.07. The S&P 500 declined 44.80 points, or 0.56%, to 7,775.04, while the Nasdaq Composite dropped 235.16 points, or 0.85%, to 27,364.73.
Brent crude climbed back above $100 a barrel as concerns about Middle East supply disruptions persisted, reviving worries that higher energy costs could fuel inflation and keep interest rates elevated.
“We’re seeing a little bit of profit-taking today. The market is very focused on the Fed minutes, but ultimately it’s where oil prices and yields move that will determine the market’s direction today,” said Peter Cardillo, chief market economist at Spartan Capital Securities.
Technology stocks led the declines. Micron Technology fell 2.3%, Nvidia slipped 0.7% and the Philadelphia Semiconductor Index lost 2.3%.
SpaceX dropped 1.7% after the Financial Times reported that Elon Musk’s rockets-to-AI company was seeking $40 billion in financing to purchase Nvidia chips.
Eight of the S&P 500’s 11 sectors traded lower, with materials and industrials leading the decline. Energy and healthcare gained 0.6% each.
The 30-year Treasury yield climbed to 5.72%, its highest level since 2002. Investors awaited minutes from the Fed’s September meeting, when policymakers raised interest rates to curb inflation.
Markets broadly expect the central bank to leave rates unchanged in October, although traders continue to price in the possibility of a December increase, according to the CME FedWatch Tool.
The broader market has lagged the headline indexes. The equal-weighted S&P 500 remains more than 5% below its record high, while the interest-rate-sensitive Russell 2000 is over 8% below its all-time peak.
Earnings season approaches
Attention is expected to turn to third-quarter earnings next week, when several major financial companies are scheduled to report.
US equities have recently been supported by enthusiasm around artificial intelligence and expectations of robust earnings, despite elevated energy prices and a bond-market selloff that has intensified concerns about tighter monetary policy.
Analysts expect aggregate S&P 500 earnings to rise 30.6% from a year earlier during the July-September quarter, according to LSEG. Energy earnings are forecast to surge 114.7%, while technology-sector profits are projected to jump 66.5%.
Although the estimate trails the 54% earnings increase recorded in the second quarter, investors expect another strong reporting season to support stock markets near record highs.
Roblox fell 1.6% after Google and Unity announced a partnership to develop an AI gaming platform that could compete with the company’s offerings.
Declining stocks outnumbered advancers by 3.74 to 1 on the NYSE and 3.19 to 1 on the Nasdaq.
The S&P 500 recorded eight new 52-week highs and five new lows, while the Nasdaq Composite posted eight new highs and 129 new lows.
(Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times)
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