4:20pm: Treasury yields climb
Wall Street extended its selloff on Wednesday, with the Dow Jones Industrial Average falling 440 points as oil prices topped $100 a barrel and Treasury yields climbed to their highest levels in nearly three years.
The Dow closed at 52,346, down 440 points, or 0.8%, while the S&P 500 fell 40 points, or 0.5%, to 7,633. The Nasdaq dropped 188 points, or 0.7%, to finish at 26,233.
Investors remained cautious as surging commodity prices added to concerns that inflation could remain elevated, complicating the outlook for the Federal Reserve ahead of its upcoming policy meeting.
Brent crude moved above $100 a barrel as concerns over Middle East oil supplies intensified, while the benchmark 10-year Treasury yield rose 3 basis points to around 4.83%, its highest level since late 2023.
The rise in yields came after Treasury Secretary Scott Bessent announced that the Treasury Department plans to triple the size of its next bond buyback program in an effort to address rising borrowing costs. The move did little to calm the bond market, however, with investors continuing to focus on inflation risks and the prospect of tighter monetary policy.
The three major indexes have now posted three straight days of losses, with higher energy prices and borrowing costs weighing on investor appetite for risk.
Attention now turns to Thursday's corporate earnings calendar, with Macy's due to report before the opening bell, followed by results from Oracle and Adobe after the market closes.
3:40pm: Small cap wrap
- Graphene Manufacturing Group Ltd (TSX-V:GMG, OTCQX:GMGMF) said its fast-charging GCELLS showed no performance loss after 489 six-minute charge cycles, while a comparable Lithium Titanate Oxide battery declined to 86% of its original capacity after 64 cycles.
- Century Lithium Corp. (TSX-V:LCE, OTCQX:CYDVF) submitted a Mine Plan of Operations and Nevada Reclamation Permit Application for its wholly owned Angel Island Lithium Project in Esmeralda County, Nevada.
- Trust Stamp Inc (NASDAQ:IDAI, ISE:AIID) is waiving setup fees and accelerating onboarding for financial institutions switching to its driver's license verification service as it seeks to capitalize on a major data leak at rival identity verification provider IDScan.
- Ocean Power Technologies Inc (NYSE-A:OPTT) is participating in a US Army coastal demonstration in North Carolina, where it will test its WAM-V maritime drone platform in live surf, waves, currents and coastal inlet conditions.
- 374Water Inc (NASDAQ:SCWO, FRA:8LL) outlined a three-part growth strategy for scaling its AirSCWO technology, focusing on near-term waste destruction services, regional biosolids infrastructure and eventual global expansion.
- Pinnacle Silver & Gold Corp (TSX-V:PINN, OTCQB:PSGCF, FRA:P9J) reported additional high-grade gold and silver mineralization from underground drilling at the historic Pinos Cuates mine in Durango, Mexico, including an intercept grading 6.19 grams per tonne gold and 90 grams per tonne silver over 10.89 metres.
2:30pm: Market movers
- Casey's General Stores Inc (NASDAQ:CASY) shares fell about 15% after inside same-store sales growth missed expectations, overshadowing quarterly revenue, earnings and EBITDA that exceeded forecasts.
- Signet Jewelers Limited (NYSE:SIG) raised its full-year profit forecast after second-quarter earnings beat Wall Street expectations, sending shares up 20%.
- Chewy reported second-quarter revenue and adjusted earnings above Wall Street estimates, but its shares fell 8.6% after free cash flow came in below expectations.
- Academy Sports + Outdoors raised its full-year adjusted profit forecast after second-quarter earnings beat expectations and revenue matched estimates, sending shares up 9%.
- ODDITY shares jumped 14% after the consumer technology company reported second-quarter results above Wall Street expectations and issued a stronger-than-expected full-year profit outlook.
- Compass Pathways (NASDAQ:CMPS) shares rose 4% after 52-week Phase III data showed sustained efficacy for its investigational COMP360 oral psilocybin treatment for treatment-resistant depression with dosing potentially required only two to four times a year.
- Jersey Mike's reported second-quarter adjusted profit above expectations but revenue slightly below estimates, while forecasting accelerating same-store sales growth in the current quarter.
- Graphene Manufacturing Group Ltd (TSX-V:GMG, OTCQX:GMGMF) said its fast-charging GCELLS showed no performance loss after 489 six-minute charge cycles, while a comparable Lithium Titanate Oxide battery fell to 86% of its original capacity after 64 cycles.
1:30pm: Weak trading ahead
Weak trading looms for the rest of September, according to Chris Beauchamp, Chief Market Analyst at online trading and investing platform IG.
“In mid-term years such as this, the S&P 500 normally bottoms out at the end of September, around a month earlier than in the other three years of the US presidential cycle. But this still leaves traders with a good couple of weeks in which, historically, stocks have performed quite poorly," Beauchamp wrote.
"Thus sellers find themselves pushing at an open door, and while most indices are still well above their April lows, things could get ugly quite quickly.”
11:40am: Apple's 'Surprise and Shine'
Apple Inc (NASDAQ:AAPL, XETRA:APC) is hosting its "surprise and shine" event today, where it is widely expected to unveil its first foldable device, the iPhone Ultra.
The event begins at 1pm ET at the Steve Jobs Theater in Cupertino, and will stream live on Apple's website and YouTube channel.
Rival firms including Samsung and Google have already released multiple generations of foldable phones, putting pressure on Apple to justify its delayed entry into the category.
Expectations will be "sky high" for the event, according to Wall Street and Silicon Valley experts.
Industry watchers expect the iPhone Ultra to share a similar form factor to Samsung's Galaxy Z Fold8, with a 5.3 inch outer display and a larger 7.7 inch inner screen.
Bloomberg's Mark Gurman has reported that the device will miss out on a telephoto lens found on most premium smartphones, though it may include a nearly creaseless folding display with improved durability.
The phone is expected to launch in just two colours, black and white, with a starting price above $2,000.
10:05am: Oil hits $100
Stocks opened lower Wednesday as oil prices surged to fresh highs and investors kept a close eye on escalating tensions in the Middle East.
The Dow Jones Industrial Average fell 407 points, or 0.8%, to 52,379, while the S&P 500 dropped 22 points, or 0.3%, to 7,652. The Nasdaq slipped 84 points, or 0.3%, to 26,337.
Oil was once again at the center of investors’ attention, with Brent crude futures climbing above $100 per barrel for the first time since July and West Texas Intermediate crude approaching $95. The sharp move higher followed another escalation in the conflict involving the US and Iran, renewing concerns about potential supply disruptions and persistent bottlenecks in the Persian Gulf.
The latest developments came after US forces destroyed five Iranian oil tankers in response to attempted strikes on American warships. Iran subsequently responded by attacking a US base in Jordan, adding another layer of uncertainty to an already volatile geopolitical backdrop.
Investors were also watching the bond market, with the Treasury due to announce the size of Thursday's debt-buyback operation this morning. The government is also set to auction $39 billion in 10-year notes later Wednesday, an event that could provide another test for markets already grappling with elevated Treasury yields.
On the corporate front, Apple was in focus ahead of its 1pm ET event, where the company is widely expected to unveil a foldable iPhone. GameStop also drew attention after boosting its outlook for adjusted EBITDA despite reporting lower sales, while Meta Platforms shares rose following the launch of its new AI agent, Muse.
Ahead of the bell
Wall Street looks set for a quiet open, but don't let that fool you; there's plenty simmering under the surface. Dow futures slipped 0.3% following Tuesday's rough session, while S&P 500 and Nasdaq-100 contracts eased 0.2% and 0.4% respectively.
Crude is creeping toward triple digits again, with Brent at $99 a barrel and WTI at $94, as tensions between the US and Iran ratchet higher.
That's feeding straight into Fed speculation. Traders now put the odds of a 25 basis point rate hike this month at 60%, per CME Group, ticking up from a day earlier.
Earnings and Apple in the spotlight
Inflation nerves are doing most of the talking today, though Chewy and American Eagle Outfitters will offer a read on the consumer when they report.
Apple's iPhone event is also on deck, with new chief executive John Ternus taking the stage for the first time, giving investors something other than oil and rates to chew on for a change.
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