Stocks dropped Thursday after U.S. oil prices topped $100 a barrel, amid growing fears of higher inflation from a prolonged war in the Middle East.
The Dow Jones Industrial Average dropped 258 points, or 0.5%. The S&P 500 fell 0.5%, while the Nasdaq Composite slid 0.4%.
Higher oil prices continued to weigh on sentiment, as the war between the U.S. and Iran stretched into a seventh month. U.S. West Texas Intermediate futures for October jumped above $100 per barrel. Futures for the international benchmark Brent crude for November delivery spiked above $105 a barrel.
The jump in oil prices pushed the 10-year Treasury yield above 4.9%, the highest level since November 2023.
High beta chip stocks that have led the bull market traded lower on fears higher rates and oil could slow the economy. Intel and Micron Technology fell 6% and 4%, respectively.
A tame wholesale inflation report failed to allay fears coalescing around higher rates and oil prices. August’s producer price index, a measure of wholesale inflation, rose a seasonally adjusted 0.4% for the month, in line with the Dow Jones consensus. On an annual basis, that put PPI at 5.4%, which is still well above the Fed’s 2% inflation target.
The report comes ahead of the closely watched consumer price index on Friday. Both numbers feed into the Fed’s primary inflation gauge, the personal consumption expenditures price index, which won’t be released until after the Fed’s interest rate vote Sept. 16.
“The PPI release itself was inconclusive, in that doesn’t really help to settle the question of ‘hike or no hike’ from the Fed next week, but WTI oil prices surging back above $100 and Treasury yields hitting new highs is certainly raising the stakes for investors ahead of tomorrow’s crucial CPI report,” wrote Stephen Coltman, head of macro at 21shares.
Fed funds futures were last pricing in a 74% likelihood of a quarter point hike following the conclusion of next week’s meeting, according to the CME FedWatch Tool.
The major averages are coming off a three-day slide, after the Treasury Department said it would buy back up to $6 billion in longer-term debt – triple the usual amount. Less than a month ago, the Treasury said it would more than double the size of its $2 billion government debt repurchases.
— CNBC’s Jeff Cox and Spencer Kimball contributed to this report.
Apple shares pop following foldable phone launch
Apple shares are up in early trading on Thursday following the launch of the company’s first foldable smartphone, the iPhone Duo.
The stock is up 1% as of 10:15 a.m. ET. Wall Street analysts like the $2,000 starting price of the phone, which was below many estimates that ranged as high as $2,500.
CNBC Pro subscribers can read more here.
– Tobias Burns
Nasdaq invests in Kraken parent as it eyes next year for ‘tokenized’ equities trading
Nasdaq’s venture capital arm is investing $100 million in Kraken parent Payward, partnering with the crypto firm to launch tokenized equities in 2027.
The deal is an expansion on a previous one between Nasdaq and Payward to test Nasdaq Equity Tokens. In this new phase, the companies will develop an infrastructure to distribute and trade tokenized stocks, which is the issue of digital representations of publicly traded securities on a blockchain network.
The partners expect to launch their tokenized equities in the second quarter of 2027.
Read more here.
— Tanaya Macheel
Stocks open lower Thursday
Stocks opened lower Thursday.
The Dow Jones Industrial Average dropped 195 points, or 0.4%. The S&P 500 fell 0.6%, while the Nasdaq Composite slid 0.9%.
— Sarah Min
U.S. crude oil tops $100 again
Crude oil prices rose 4% on Thursday after fighting between the U.S. and Iran sharply escalated this week, as the war drags on into its seventh month with no end in sight.
U.S. West Texas Intermediate futures jumped 4.4% to $100.27 per barrel by 8:57 a.m. ET. Brent crude, the international benchmark, advanced 4% to $105.24 a barrel.
— Spencer Kimball, Justina Lee
Treasury yields hit multi-year highs
U.S. Treasury yields hit multi-year highs ahead of the wholesale inflation report.
- The yield on the 10-year hit 4.867%, its highest level since November 2023 when it reached 4.935%
- The yield on the 2-year hit 4.449%, its highest level since July 2024 when it reached 4.460%
— Sarah Min, Nick Wells
Stocks making making moves premarket
Here are some of the names moving before the opening bell:
- Meta Platforms — The parent of Facebook and Instagram rose 1.3% following upgrade at JPMorgan. The firm sees “meaningful upside potential” as Meta rolls out its artificial intelligence models and products.
- Novartis — The Swiss drugmaker gained nearly 2% after Reuters reported a major shareholder called for an overhaul of Novartis’ board to boost corporate governance. Shares fell earlier this week after the company saw three drug trial setbacks.
- Copper miners — Copper prices fell, dragging down miners. Freeport-McMoRan and Southern Copper both tumbled about 7%.
Click here to read the full list of premarket movers.
— Michelle Fox
Macy’s shares fall
Macy’s shares fell more than 2% in the premarket, even after the retailer delivered a beat in its second fiscal quarter and raised its guidance.
The company posted adjusted earnings of 40 cents per share, though it was not immediately clear whether it was comparable to the 37 cents expected by analysts polled by LSEG. Revenue of $4.87 billion exceeded the $4.83 billion expected.
Macy’s is nearing the end of a three-year turnaround plan under CEO Tony Spring that aims to spark growth and invest in locations that perform well against a challenging backdrop for department stores.
— Sarah Min, Laya Neelakandan
Treasury yields move higher
Treasury yields moved higher on Thursday as traders await the release of U.S. wholesale inflation data.
The 10-year U.S. Treasury note yield — the key benchmark for mortgage borrowing, auto loans and credit card debt — was up more than 2 basis points at 4.8589%. The 2-year Treasury note yield, which is typically more sensitive to short-term Federal Reserve interest rate decisions, increased 1 basis point to 4.4404%.
The longer-dated 30-year Treasury bond yield, which moves in line with broader geopolitical risks, was up more than 2 basis points at 5.3092%.
— Hugh Leask
Apple shares rise after foldable iPhone Duo debut
Apple stock gained 1% in pre-market trading on Thursday, as investors digested news from its biggest launch event of the year — including the debut of the $2,000 foldable iPhone Duo.
Loading chart…
The company also unveiled the iPhone 18 Pro, Airpods 5 and Apple Watch Series 12 on Wednesday.
— Chloe Taylor
An ECB rate hike is ‘all but certain’ — but investors divided on what comes next
The European Central Bank is widely expected to raise interest rates on Thursday, but uncertainty around the U.S.-Iran war is clouding the outlook for its longer-term policy path, market watchers say.
Markets are pricing in a 100% chance of the ECB raising its key interest rate by at least 25 basis points, according to LSEG data.
Its September meeting comes days after data showed inflation in the euro zone hit 3.3% in August, with energy inflation surging to 14.3%.
— Chloe Taylor
Asia-Pacific markets close mixed
Asia-Pacific markets closed mixed on Thursday.
Japan’s Nikkei 225 and the broad-based Topix each added 0.2% to end the day at 65,270.95 and 4,054.58, respectively.
South Korea’s Kospi slid 0.25% to 7,033.92, while the small-cap Kosdaq added 0.79% to 836.92.
Hong Kong’s Hang Seng index was down 1.23% in its last hour of trade, while mainland China’s CSI 300 lost 0.53% to 4,548.39.
Australia’s S&P/ASX 200 declined over 1% to 8,819.4.
— Lee Ying Shan
UBS CEO flags investor complacency as geopolitical and economic risks mount
UBS CEO Sergio Ermotti on Thursday said that investors have grown complacent over the past few years, even as geopolitical and economic risks have mounted.
“There has been a level of complacency in financial markets in the last few years,” Ermotti told CNBC’s Christine Tan, adding that given the environment one would have expected considerably higher volatility.
While markets have experienced occasional bouts of turbulence, strong investment in artificial intelligence, data centers and other new technologies has helped support economic growth and financial markets, he said.
The UBS top boss cautioned that investors face an increasingly complicated environment given multiple headwinds. “New problems or new issues are emerging without any of the old ones being addressed or being closed.”
Read the full story here.
—Lee Ying Shan
Oil little changed, with Brent above $101 after U.S. destroys Iranian oil tankers
Oil was little changed, giving up most gains from Thursday morning, amid worries that escalating tensions in the Middle East could further exacerbate supply disruptions.
Futures for international benchmark Brent crude for November delivery inched 0.12% lower to $101.08 a barrel. U.S. West Texas Intermediate futures for October was 0.10% higher at $96.15 per barrel.
Tensions escalated after the U.S. military on Tuesday destroyed five Iranian crude oil tankers in retaliation for attempted attacks on an American warship. U.S. Central Command said the warship successfully evaded Iranian attack and no American personnel were harmed.
—Justina Lee
European stock markets open in positive territory
The pan-European Stoxx 600 was up 0.17% in early trade as most regional sectors and major bourses in the continent moved higher following the market open.
In Milan, the Italian FTSE MIB was up 0.58%, followed by the French CAC 40, which rose 0.34% in Paris. In London, meanwhile, the U.K. FTSE 100 added 0.11%, with Germany’s DAX advancing almost 0.1% in Frankfurt.
Among Europe’s sectors, telecoms, banks and utilities led gains, each notching more than 0.7%.
—Hugh Leask
Treasury yields rise as inflation, heavy supply outweigh U.S. buyback plans
The 10-year Treasury yield inched higher 1 basis point higher to 4.847% on Thursday, while the 30-year yield also climbed by the same to 5.298%, as pressure at the long-end of the yield curve persisted despite the Treasury Department expanding its bond-buyback program.
Treasury Secretary Scott Bessent said Wednesday the department would buy as much as $6 billion of 10- to 20-year Treasurys on Sept. 10.
Elevated yields suggest investors remain focused on more fundamental factors including inflation risks and heavy Treasury supply, according to James Ooi, market strategist at Tiger Brokers.
Oil prices above $100 a barrel have added to inflation concerns, while investors are awaiting U.S. producer and consumer inflation data for further clues on the rates outlook.
“While Treasury buybacks can improve liquidity at the margin, the fact that yields still climbed higher suggests the market sees the long-end pressure as a fundamental rates issue tied to inflation concerns and heavy Treasury supply, rather than merely a liquidity issue,” Ooi said.
—Lee Ying Shan
DBS sued for US$1 billion in claim relating to 1MDB
DBS, Southeast Asia’s largest bank DBS, “categorically rejects and will vigorously resist” a lawsuit against it seeking $1 billion in 1MDB-linked claims.
The lawsuit was filed by claimants including liquidators of four companies: Blackrock Commodities (Global), Platinum Global Luxury Services, Affinity Equity International Partners and TKIL Global Investments.
“The Claim is for damages which the claimants have purportedly estimated at S$1.298 billion,” the bank said in a statement.
“It is a matter of public record that there have been global recovery efforts relating to 1Malaysia Development Berhad, supported by legal counsel since 2018. All this time, there was no claim against DBS,” the bank said.
1Malaysia Development Berhad, a state wealth fund set up by former Malaysian Prime Minister Najib Razak in 2009, was hurt by a massive global corruption and money-laundering scandal, for which global recovery efforts are still ongoing.
Shares of DBS fell 0.58% in early trading on Thursday.
—Justina Lee
Australia leads regional losses as Asia-Pacific markets fall
Asia-Pacific markets opened lower Thursday, with Australian equities leading regional declines.
Australia’s benchmark S&P/ASX 200 was down 1.36%. Index heavyweights Rio Tinto and BHP Group fell 2.93% and 2.52%, respectively.
Japan’s Nikkei 225 dropped 0.62%, and the Topix declined 0.56%.
South Korea’s Kospi lost 0.24%, while the small-cap Kosdaq was 0.83% lower.
— Lee Ying Shan
Asia markets poised to fall after Wall Street extends losses
Asia-Pacific markets were set to fall Thursday, tracking Wall Street declines, as higher oil prices dent sentiment with the Middle East conflict dragging on.
Japan’s Nikkei 225 was set to fall, with its Chicago and Osaka futures contracts last at 64,350 and 64,360 respectively, compared with the index’s previous close of 65,142.78.
Hong Kong’s Hang Seng index futures were at 24,982, lower than the index’s last close of 25,274.96.
Futures for Australia’s S&P/ASX 200 last traded at 8,816, compared with the index’s previous close of 8,911.4.
Brent futures gained 3.4% to $101.21 a barrel Wednesday, the international benchmark’s highest closing price since May 22. U.S. West Texas Intermediate futures advanced 3.3% to settle at $96.05.
— Lee Ying Shan
The rate on a 30-year fixed mortgage hits 6.97%
The cost of financing a home purchase hit its highest level in more than a year — and it’s creeping closer to 7%.
The rate on a 30-year fixed mortgage reached 6.97% on Wednesday, according to Mortgage News Daily. That’s the highest level since May 30, 2025.
The last time the 30-year fixed mortgage was at 7% or higher was on May 26, 2025, when it was 7.02%.
This jump in the 30-year mortgage coincided with a surge in the 10-year Treasury yield, which leapt to 4.857% for its highest level since November 2023. Rates on 30-year mortgages are influenced by the 10-year Treasury note yield.
—Gina Francolla, Darla Mercado
Stocks making the biggest moves after hours: AeroVironment, American Eagle & more
Several companies saw their shares move in extended trading following earnings reports and other developments.
AeroVironment – Shares of the drone manufacturer jumped 2% after first-quarter results trounced estimates. AeroVironment earned 59 cents per share on an adjusted basis and posted revenue of $480 million. Analysts polled by LSEG sought 25 cents a share on $456 million.
American Eagle Outfitters – The teen apparel retailer slid 10%. American Eagle’s comparable sales in the second quarter declined 1%, versus analysts’ call for a decline of 0.6%. The company forecast operating income in the current quarter to range from $110 million to $115 million, versus the StreetAccount consensus estimate of $124.3 million.
Read more about Wednesday’s after-hours movers here.
—Darla Mercado
