The S&P 500 Index ($SPX) (SPY) today is up by +0.38%, the Dow Jones Industrials Index ($DOWI) (DIA) is down by -0.05%, and the Nasdaq 100 Index ($IUXX) (QQQ) is up by +0.46%.  September E-mini S&P futures (ESU25) are up +0.37%, and September E-mini Nasdaq futures (NQU25) are up +0.49%. 

Stock indexes are mostly higher today, recovering some of Tuesday's losses on strength in megacap technology stocks.  Alphabet is up more than +7% after a judge ruled in an antitrust case late Tuesday that the company won't be forced to sell its Chrome browser. Also, Apple is up more than +2% after a court ruling stopped short of barring the company's lucrative search arrangement with Google, a deal that has generated roughly $20 billion in revenue a year for Apple. 

Stocks are also finding support from some stabilization in government bond prices, as the recent selloff in bond prices has lost momentum. The 10-year T-note yield is down -1 bp to 4.27%.  Global bond yields rose sharply on Tuesday on concerns over government finances and lingering inflation risks.   

US MBA mortgage applications fell -1.2% in the week ended August 29, with the purchase mortgage sub-index down -3.1% and the refinancing mortgage sub-index up +0.9%.  The average 30-year fixed rate mortgage fell -5 bp to 6.64% from 6.69% in the prior week.

This week's US economic calendar is busy.  Later today, July JOLTS job openings are expected to fall by -64,000 to 7.373 million. Also, July factory orders are expected to drop -1.4% m/m.  Finally, on Wednesday, the Fed's Beige Book will be released.  On Thursday, the Aug ADP employment change is expected to increase by +80,000.  Also, weekly initial unemployment claims are expected to increase by +1,000 to 230,000, and Q2 nonfarm productivity is expected to be revised upward to 2.7% from the previously reported 2.4%, with Q2 unit labor costs expected to be revised downward to 1.4% from 1.6%.  In addition, the Aug trade deficit is expected to widen to -$78.0 billion from -$60.2 billion in June.  Finally, the Aug ISM services index is expected to climb by +0.8 to 50.9.  On Friday, Aug nonfarm payrolls are expected to rise by +75,000, and the Aug unemployment rate is expected to rise by 0.1 to 4.3%.  Aug average hourly earnings are expected to increase +0.3% m/m and +3.7% y/y.

Regarding tariffs, a federal appeals court ruled late last Friday that President Trump exceeded his authority by imposing global tariffs without Congressional approval, but the court let the tariffs remain in place while appeals continue.  The US Court of Appeals for the Federal Circuit Court said, "The statute bestows significant authority on the President to undertake a number of actions in response to a declared national emergency, but none of these actions explicitly include the power to impose tariffs, duties, or the like, or the power to tax."  The case now appears to be headed to the Supreme Court for a final decision.  According to Bloomberg Economics, the average US tariff will rise to 15.2% if rates are implemented as announced, up from 13.3% earlier, and significantly higher than the 2.3% in 2024 before the tariffs were announced.

Federal funds futures prices are discounting the chances of a -25 bp rate cut at 92% at the next FOMC meeting on September 16-17.  The markets are discounting the chances at 51% for a second -25 bp rate cut at the following meeting on October 28-29.

Overseas stock markets today are mixed.  The Euro Stoxx 50 is up +0.60%.  China's Shanghai Composite closed down -1.16%.  Japan's Nikkei Stock 225 closed down -0.88%.

Interest Rates

December 10-year T-notes (ZNZ5) today are up +2 ticks, and the 10-year T-note yield is down -0.8 bp to 4.271%. 

Dec T-notes today are slightly higher, recovering some of Tuesday's losses.  Today's 2% fall in WTI crude prices has reduced inflation expectations and sparked some short-covering in T-notes. Today's strength in European government bonds is also providing carryover support to T-notes.

However, T-notes remain under pressure from supply risks.  About $55 billion of corporate debt securities are expected to be priced this week, which will prompt bond dealers to enter short positions on T-note futures as a hedge against the incoming supply.  Also, investors are demanding higher yields for holding government debt in the face of spiraling budget deficits and sticky inflation.  Finally, T-note yields are climbing on concerns over Fed independence, with President Trump trying to oust Fed Governor Cook.  The worry is that Mr. Trump is trying to replace Cook and other Fed officials with policymakers more inclined to lower interest rates regardless of inflation risks.

European government bond yields today are moving lower.  The 10-year German bund yield is down -2.1 bp to 2.765%.  10-year UK gilt yield fell from a 7.5-month high of 4.845% and is down -1.7 bp to 4.783%.

Eurozone July PPI eased +0.2% y/y from +0.6% y/y in June, slightly stronger than expectations of +0.1% y/y.

The Eurozone Aug S&P composite PMI was revised downward by -0.1 to 51.0 from the previously reported 51.1.

Swaps are discounting the chances at 1% for a -25 bp rate cut by the ECB at the September 11 policy meeting.

US Stock Movers

Alphabet (GOOGL) is up more than +7% to lead gainers in the S&P 50 and Nasdaq 100 after a judge ruled in an antitrust case late Tuesday that the company won't be forced to sell its Chrome browser. 

Apple (AAPL) is up more than +2% to lead gainers in the Dow Jones Industrials after a court ruling stopped short of barring the company's lucrative search arrangement with Google, a deal that has generated roughly $20 billion in revenue a year for Apple.

Western Digital (WDC) is up more than +4% after Morgan Stanley named the stock its "Top Pick" with an overweight rating and a price target of $99.

The Campbell's Company (CPB) is up more than +4% after reporting Q4 adjusted EPS of 62 cents, better than the consensus of 56 cents.

Macy's (M) is up more than +19% after reporting Q2 net sales of $4.81 billion, better than the consensus of $4.71 billion, and raising its full-year net sales estimate to $21.15 billion-$21.45 billion from a previous estimate of $21.00 billion-$21.40 billion. 

Gold mining stocks are moving higher today, with the price of COMEX gold posting an all-time high.  As a result, Anglogold Ashanti Plc (AU) is up more than +3% and Gold Fields Ltd (GFI) is up more than +1%.   

HealthEquity (HQY) is up more than +3% after reporting Q2 adjusted EPS of $1.08, stronger than the consensus of 92 cents, and raising its 2026 adjusted EPS forecast to $3.74-$3.91 from a previous estimate of $3.61-$3.78, above the consensus of $3.73.

Dollar Tree (DLTR) is down more than -9% to lead losers in the S&P 500 after forecasting 2026 adjusted EPS of $5.32-$5.72, the midpoint below the consensus of $5.53. 

Bruker Corporation (BRKR) is down more than -8% after announcing a public offering of $600 million of Mandatory Convertible Preferred Stock.   

Smithfield Foods (SFD) is down more than -5% after announcing the launch of a secondary public offering of 16 million shares of common stock. 

Zscaler (ZS) is down more than -3% to lead losers in the Nasdaq 100 after forecasting 2026 adjusted EPS of $3.64-$3.68, weaker than the consensus of $3.68. 

Marvell Technology (MRVL) is down more than -2% as analysts have lowered their price targets for the stock by an average of 8.6% since it reported earnings last Thursday.

Hamilton Lane Incorporated (HLNE) is down more than -2% after announcing it has commenced an underwritten public offering of 528,705 shares of Class A common stock.   

Earnings Reports(9/3/2025)

Dollar Tree Inc (DLTR), Gitlab Inc (GTLB), Hewlett Packard Enterprise Co (HPE), Macy's Inc (M), Salesforce Inc (CRM), The Campbell's Company (CPB).