US stock indices ended lower across the board yesterday as investors continue to reduce their exposure this week following Friday’s pullback. The Dow and S&P 500 both lost 0.7%, while the tech-heavy NASDAQ ended 0.8% lower. The small-cap Russell 2000 had the worst of it, though, closing down 1.0%. But there was something of a turnaround in early trade on Wednesday.
US stock index futures came under further selling pressure during the Asian-Pacific session but then rebounded as European markets opened. Buyers stepped in as Treasury yields dropped back from the highs hit yesterday. This was when the yield on the 30-year bond hit 5.19% - its highest level since 2007, just before the Great Financial Crisis.
Meanwhile, the key 10-year Treasury Note got up to 4.69%, its highest level since February 2025. These moves came as the markets continue to price in raised inflation expectations because of the ongoing war between the US and Iran, and the continued closure of the Strait of Hormuz.
Traders are also girding their loins ahead of chip-giant NVIDIA’s earnings release after tonight’s close. NVIDIA is the world’s largest company by market capitalisation and has been one of the main drivers of stock market gains from the lows of October 2022.
So, what happens here matters. A look at options positioning ahead of the release suggests that traders are preparing for a swing of 6.5% in both directions, although there’s a slight bias towards a bullish outcome. NVIDIA was up around 1.7% today, trading around $224.50.
Source: TN Trader
