Nasdaq 100: Futures Lead the Stock Market Rebound as Bond Yields Stay High

Stock Futures Are Recovering but the Bond Market Has Not Backed Down December E-mini S&P 500 Index futures are trying to recover from Thursday’s break. December E-mini Nasdaq-100 Index futures are holding closer to their recent high. The 10-year Treasury yield reached 5.23% late Thursday, the highest since 2007. Yields are little changed Friday morning. The Dow is headed for a fourth consecutive losing week while the Nasdaq-100 is up 1.6%. That is concentration, not broad strength, and the bond market is not giving either side a reason to change the argument. At 10:59 GMT, December E-mini S&P 500 Index futures are trading 7,787.50, up 20.50 or 0.26%. The session high is 7,792.50 and the low is 7,748.50. December E-mini Nasdaq-100 Index futures are trading 30,925.25, up 158.50 or 0.52%. The session high is 30,963.25 and the low is 30,679.00. Federal Reserve Governor Michael Barr’s hawkish comments, elevated energy prices tied to the Iran war, and this week’s PMI reports from S&P Global pushed the 10-year to 5.23% and the 30-year to 5.50% by Thursday night. Fed funds futures are carrying about a 68% chance of another rate hike in October. The two-year reached its highest since 2023 earlier in the week. The 30-year fixed mortgage rate climbed to 7.45%, the highest since 2024. Morgan Stanley expects higher borrowing costs to weigh on spending and contribute to slower real consumption growth next year. Crude remains elevated with the Iran story unresolved. Every input this week pointed the same direction and the bond market moved on all of them together. Durable-goods orders and the University of Michigan consumer-sentiment report are Friday’s data. The rate trade has been responding to strong numbers all week. A record 45% of S&P 500 constituents now have a negative three-month beta to the index. That is more than double the level during the 2000 dot-com collapse. The top eight stocks carry a beta of 1.23. The other 492 average 0.87. UBS warned that markets are increasingly reliant on AI capital spending to carry growth. The investment cycle is still supporting earnings expectations. It also leaves the market exposed if spending slows. Thursday’s Oracle force majeure report on the New Mexico data-center project landed right on that question. The Dow is losing ground for a fourth straight week. Rate-sensitive names are taking the selling. The mega-cap trade is holding the index together and the beta data says it has never been this concentrated. December E-mini Nasdaq-100 Index futures bounced from 30,370.00 Thursday and are holding the recovery Friday. The contract is up 1.6% for the week. December E-mini S&P 500 Index futures tested the 50-day moving average Thursday and recovered. The cash session finished nearly flat in both the S&P 500 Index and Nasdaq Composite Index while the Dow closed lower. The buying pressure Thursday was enough to keep the indices from breaking. Friday is testing whether that hold was real or whether it was a pause before the bond market presses again. December E-mini S&P 500 Index futures are edging higher early Friday after a successful test of the 50-day moving average at 7,720.29 and the minor retracement zone at 7,711.75 to 7,679.50 the previous session. The new minor range is 7,707.25 to 7,848.50. The contract is currently testing its retracement zone at 7,778.00 to 7,794.50. Trader reaction to this area is likely to set the.