U.S. stock futures edged lower on Monday as elevated Treasury yields kept investors cautious ahead of the Federal Reserve’s policy meeting later this week.
Futures linked to the Dow Jones Industrial Average, S&P 500 and Nasdaq-100 were each down less than 0.2%, pointing to a subdued start for major U.S. indexes.
Treasury Yields Remain in Focus
The 10-year Treasury yield climbed to its highest level in more than two decades, keeping borrowing costs and their potential impact on equity valuations in focus.
Higher government bond yields can increase financing costs across the economy and make fixed-income assets relatively more attractive compared with equities, particularly affecting valuations in interest-rate-sensitive sectors.
Markets are also assessing last week’s weaker-than-expected employment data, which reduced expectations for another Federal Reserve rate increase this month and provided some relief after the recent rise in bond yields.
Investors Await Fed and Economic Data
Attention now turns to a series of economic indicators and Federal Reserve developments that could provide additional signals on the outlook for interest rates.
Monday’s economic calendar includes the Institute for Supply Management’s services activity report. Minutes from the Federal Reserve’s September meeting are due Wednesday, followed by the University of Michigan’s preliminary October consumer sentiment reading on Friday.
The reports will provide investors with additional information on economic activity, household confidence and the conditions policymakers are considering as they assess the path for monetary policy.
