NEW YORK — U.S. stock markets entered September under pressure as rising Treasury yields and higher oil prices reduced investor appetite for riskier assets.
Dow, S&P 500 and Nasdaq futures all declined ahead of Tuesday's trading session, with the technology-heavy Nasdaq showing the largest decline.
Investors Face a More Complicated September
August was a strong month for American equities.
The S&P 500 and Nasdaq recorded some of their strongest August performances in years.
September is historically different.
Since 1926, the S&P 500 has averaged a decline of approximately 0.7% during September, making it historically the weakest month for the index.
This year, investors are also confronting higher oil prices and rising Treasury yields.
Those developments can create pressure across the economy.
Higher oil prices can increase transportation and production costs.
Higher Treasury yields can increase borrowing costs for businesses and consumers.
The combination can make it more difficult for the Federal Reserve to reduce interest rates.
Investors are therefore watching employment data and inflation indicators closely.
The upcoming jobs report could provide important clues about the strength of the U.S. economy.
Technology stocks are particularly sensitive to changes in interest rates because many high-growth companies are valued partly on expectations of future earnings.
The market's September performance will therefore depend on more than seasonal patterns.
Investors will be evaluating corporate earnings, inflation, employment and Federal Reserve policy.
For American households and businesses, the market's direction could also influence borrowing costs and investment decisions.
