The focus will be on whether the U.S. stock market can continue to limit its declines. The market is expected to closely watch long-term yields, next week’s earnings announcements and the performance of AI-related stocks.
Although the major U.S. indexes fell again in the previous session, there were periods when the declines narrowed. S&P 500 futures and Nasdaq 100 futures were soft, while NY Dow futures traded approximately $65 lower. The rise in long-term yields continued, with the 10-year U.S. Treasury yield climbing to around 5.36%. This intensified selling pressure in the domestic market, but buying back of technology stocks emerged in the afternoon as the rise in yields paused, helping the indexes avoid a sharp decline.
Selling is expected to lead the market today, while long-term yields are likely to remain high. Economic indicators have generally shown notable weakness, and comments from FRB officials have suggested caution. With monetary policy expected to be maintained this month, expectations for an additional rate hike this year may become a more limited selling factor. Financial stocks will be closely watched as earnings announcements get fully under way next week, while expectations for earnings growth among AI-related stocks are also likely to remain a focus of market attention.