US stock futures edged lower on Monday as Friday’s weak payrolls report cooled the risk of an October Federal Reserve rate increase, but failed to dislodge the bigger problem for equities: long-term borrowing costs remain historically high.
Dow, S&P 500 and Nasdaq 100 futures were each down about 0.2%, while the 10-year Treasury yield hovered near 5.26%.
The September jobs report pushed October hold odds above 80%, yet traders still expect tightening later this year.
Investors are also watching US services data, French fiscal stress and a volatile oil market, while PTC and Intel lead a busy pre-market tape.
5 things to know before Wall Street opens
1. October looks safer, but December still matters
September payrolls rose by just 29,000, unemployment increased to 4.2%, and July and August were revised down by a combined 60,000 jobs.
Markets now see roughly an 82% chance the Fed holds rates steady in October.
FedWatch pricing still assigns about a 69% probability to a quarter-point increase by December.
2. Services data could revive the yield shock
The final S&P Global services PMI is due at 9:45 am ET, followed by ISM services at 10 am. Economists expect the ISM gauge at 55.7, up from 55.4, with the prices component remaining elevated.
A strong report could revive the argument that weak payrolls do not necessarily mean weak demand.
Swissquote strategist Ipek Ozkardeskaya told MarketWatch that persistent weakness in the bond market could limit further gains in equities.
3. France is becoming a Wall Street issue
The euro fell to a 17-month low near $1.116 as France’s fiscal stress pushed the spread between French and German 10-year yields to around 150 basis points. The CAC 40 fell about 0.8%.
For US investors, a stronger dollar can pressure multinational earnings, while another European sovereign scare could tighten global financial conditions just as the Fed becomes more cautious.
4. Oil is easing, but inflation risk remains
Brent traded near $102.30 and WTI around $90.60 after both fell more than 1% earlier.
The G7’s planned 100-million-barrel reserve release and recovering Middle East exports are helping, while OPEC+ kept November production targets unchanged.
That eases the immediate shortage premium, but crude remains expensive enough to matter for inflation if Gulf supply risks flare again.
5. PTC soars while Intel slides on a new AI divide
PTC jumped about 35% after Schneider Electric agreed to buy the industrial-software company for $205 a share in cash, valuing its equity at $22.6 billion. Schneider fell about 8% in Paris.
Jefferies analysts said the transaction’s relatively low valuation reflects the pressure AI disruption has placed on software multiples, although integrating the assets still creates execution risk for Schneider.
Intel moved the other way, falling more than 3% after Elon Musk confirmed TSMC is in talks with Terafab about managing Texas semiconductor plants.
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