US Equity Futures Advance, Dollar Edges Lower: Markets Wrap

(Bloomberg) — US equity-index futures inched higher in Asian trading after signs of fatigue in the AI-driven rally caused two days of declines on Wall Street.

Contracts for the S&P 500 rose 0.1% in a sign the rally may resume after the brief pause. Chinese tech stocks rose while MSCI’s regional gauge was flat. Copper remained near the highest in more than a year after Freeport-McMoRan Inc. declared force majeure on contracted supplies from its Grasberg mine in Indonesia.

The dollar edged lower while oil dipped following its biggest jump since July. In Japan, a 40-year government bond auction drew a demand ratio that was stronger than its 12-month average.

Traders have flocked to Nvidia Corp. and Alibaba Group Holding Ltd. as the firms pour billions into artificial intelligence, a theme that has powered the rise in US and Chinese stocks this year. That rally now faces a test with Friday’s US personal consumption expenditures report, as traders look for clues on how the inflation reading could shape the path of interest rates.

“The trend of strong gains isn’t over yet,” said Craig Johnson at Piper Sandler. “However, the short-term risk-reward profile is becoming more compressed as stocks extend higher while underlying momentum fades.”

While the S&P 500 has defied September’s gloomy reputation as the worst month for equity returns, the gauge failed to gain traction on Wednesday, sparking concerns the rally has hit an air pocket.

But Chinese semiconductor stocks extended their rally as sentiment was boosted by a report that a local major memory chipmaker is developing an advanced chip packaging technology for high-bandwidth memory. A gauge of technology stocks in Hong Kong rose 1.9% to hover around levels last seen in 2021.

“The tech and AI theme continues to drive regional markets, with China tech giants leading gains again,” said Marvin Chen, an analyst at Bloomberg Intelligence. “Investors may be seeing better growth potential as Alibaba’s accelerated investment plans show that China AI development is still in relatively early stages compared to the US.”

Meanwhile, the dollar slipped against all Group-of-10 peers. Federal Reserve Bank of San Francisco President Mary Daly said further interest-rate cuts are likely needed, but the US central bank should approach those with caution.

“Some measured language from Fed officials this week, chiefly Chairperson Jerome Powell, has sucked the momentum out of the equity market rally, which is well overdue for a little pull back,” wrote Kyle Rodda, a senior market analyst at Capital.com in Melbourne.

In European news, Spanish Prime Minister Pedro Sanchez said he’ll run for re-election in 2027, despite polls that show his Socialist party would have a difficult time winning a majority in parliament.

Also, the UK’s gilt market jitters are starting to impact demand at government auctions as fiscal concerns grow ahead of the budget in November.

Splits on the Bank of England policymaking committee were on full display on Wednesday after Governor Andrew Bailey said there was further to go on interest-rate cuts just hours before external member Megan Greene proposed “skipping” a cut in November.

A key focus for investors this week will be the Fed’s preferred gauge of underlying inflation. The reading likely grew at a slower pace last month, offering policymakers some breathing room to address weakness in the US labor market.

The report on Friday is forecast to show the personal consumption expenditures price index excluding food and energy rose 0.2% in August, compared with 0.3% in July. On an annual basis, the so-called core measure is seen holding at a still-elevated 2.9%.

Corporate News:

Intel Corp. has approached Apple Inc. about securing an investment in the ailing chipmaker, according to people familiar with the matter. Oracle Corp. sold $18 billion US investment-grade bonds on Wednesday, the market’s second-largest deal this year, as the software maker ramps up its spending to meet the needs of the artificial intelligence boom. The US lowered tariffs on auto imports from the European Union to 15% retroactive to Aug. 1, cementing terms of the framework trade agreement the two sides struck almost two months ago. Chery Automobile Co., China’s biggest car exporter, rose in its Hong Kong trading debut after raising HK$9.1 billion ($1.2 billion) in an initial public offering. The Trump administration launched investigations into imports of robotics, industrial machinery and medical devices, setting the stage for fresh duties Taiwan suspended chip-export controls it placed on South Africa just two days ago — a sign it is uncomfortable with using the key tech export as a weapon in diplomatic disputes. Some of the main moves in markets:

Stocks

S&P 500 futures were little changed as of 6:50 a.m. London time Nasdaq 100 futures were little changed The MSCI Asia Pacific Index was little changed Japan’s Topix rose 0.4% Australia’s S&P/ASX 200 was little changed Hong Kong’s Hang Seng was little changed The Shanghai Composite was little changed Euro Stoxx 50 futures were little changed Currencies

The Bloomberg Dollar Spot Index was little changed The euro was little changed at $1.1743 The Japanese yen was little changed at 148.78 per dollar The offshore yuan was little changed at 7.1305 per dollar The British pound was little changed at $1.3455 Cryptocurrencies

Bitcoin fell 1.6% to $111,738.31 Ether fell 3.4% to $4,024.3 Bonds

The yield on 10-year Treasuries was little changed at 4.14% Japan’s 10-year yield was unchanged at 1.645% Australia’s 10-year yield advanced five basis points to 4.33% Commodities

Spot gold was little changed West Texas Intermediate crude fell 0.5% to $64.69 a barrel This story was produced with the assistance of Bloomberg Automation.

–With assistance from Nasteho Said and Joanne Wong.

©2025 Bloomberg L.P.