Stock Market Update

Equity futures point to a mixed, subdued opening as lingering tech weakness and rising oil prices continue to weigh on the market.

Crude oil is moving higher again this morning after Financial Times reported that Iran has considered attacking U.S. military assets in Europe if the U.S. escalates the war. While oil is up, U.S. Treasuries remain relatively stable, which is encouraging as recent highs on longer-dated note yields have been a notable headwind for the market in recent sessions.

There is not much economic data for investors to assess this morning, though the FOMC Meeting Minutes from the July FOMC meeting will be released at 3:00 p.m. ET, which will be of particular interest to a market that is undecided on what it believes the Fed's next move will be.

The MBA Mortgage Applications Index for the week ended August 15 decreased 0.4%, from a prior increase of 3.6%.

In corporate news:

• OpenAI revenue grew a somewhat underwhelming 18% in Q2, according to The Wall Street Journal.
• Lowe's (LOW 308.01, -7.63, -3.5%) beat EPS expectations by $0.18, reported revenues on-line, and guided FY27 EPS and revenues below consensus.
• Merk (MRK 146.80, +11.63, +8.6%) and Moderna (MRNA 122.93, +59.97, +95.25) trade higher after Phase 3 INTerpath-001 met its primary endpoint of recurrence-free survival and key secondary endpoint of distant metastasis-free survival in patients with completely resected stage IIB-IV melanoma.
• Target (TGT 151.48, -1.00, -0.7%) beat EPS expectations by $1.76, beat revenue expectations, and guided FY27 EPS above consensus, with revenues above consensus.

Reviewing overnight developments:

Equity indices in the Asia-Pacific region ended Wednesday on a mostly lower note with South Korea's Kospi (-5.8%) enduring a volatile night. Japan's Nikkei: -3.2%, Hong Kong's Hang Seng: +0.1%, China's Shanghai Composite: -2.4%, India's Sensex: -0.4%, South Korea's Kospi: -5.8%, Australia's ASX All Ordinaries: -0.2%.

In news:

• SK Hynix reached a tentative wage agreement with its employees.
• President Trump said that he wants to meet with North Korea's Leader Kim Jong Un in November.
• Japanese debt climbed overnight, recovering from early weakness that drove yields on longer-dated JGBs to fresh highs for the year.
• Moody's affirmed Australia's AAA rating with a Stable Outlook.

In economic data:

• Japan's June Core Machinery Orders 9.7% m/m (expected 7.2%; last -12.4%); 16.9% yr/yr (expected 10.8%; last -1.9%)
• Australia's Q2 Wage Price Index 0.8% qtr/qtr, as expected (last 0.8%); 3.2% yr/yr, as expected (last 3.2%)
• New Zealand's Q2 Input PPI 2.9% qtr/qtr (expected 1.3%; last 1.4%) and Output PPI 1.6% qtr/qtr (expected 0.8%; last 0.8%)

Major European indices trade in mixed fashion near their flat lines. STOXX Europe 600: UNCH, Germany's DAX: -0.1%, U.K.'s FTSE 100: UNCH, France's CAC 40: +0.4%, Italy's FTSE MIB: UNCH, Spain's IBEX 35: +0.1%.

In news:

• The U.K.'s CPI accelerated to 2.9% from 2.6% in July, representing the first acceleration in four months, while Core CPI remained above expectations.
• European Central Bank policymaker Rehn said that he has not seen clear signs of second-round effects, though he conceded that it is essential to anchor inflation expectations, while ECB President Lagarde said that the region can't miss out on the AI revolution.

In economic data:

• Eurozone's July CPI 0.2% m/m, as expected (last -0.1%); 2.9% yr/yr, as expected (last 2.8%). July Core CPI 0.0% m/m, as expected (last 0.2%); 2.5% yr/yr, as expected (last 2.4%). June Current Account surplus EUR35.10 bln (expected surplus of EUR26.8 bln; last surplus of EUR25.1 bln)
• U.K.'s July CPI 0.3% m/m, as expected (last 0.1%); 2.9% yr/yr, as expected (last 2.6%). July Core CPI 0.2% m/m (expected 0.1%; last 0.3%); 2.6% yr/yr (expected 2.5%; last 2.6%). July Input PPI -1.7% m/m (expected 0.0%; last -1.9%) and Output PPI 0.2% m/m, as expected (last -0.1%)
• Swiss Q2 Industrial Production 5.5% yr/yr (expected -4.7%; last -7.6%)