Stock futures edged higher on Wednesday as investors attempted to steady themselves after another session of pressure from rising U.S. Treasury yields. Futures tied to the Dow Jones Industrial Average rose 0.46%, or 239 points, while S&P 500 futures gained 0.27% and Nasdaq-100 futures added 0.22%, signalling a cautious start for Wall Street.

The latest moves come as bond yields continue to climb, raising concerns about tighter financial conditions and their impact on equities. The 30-year Treasury yield crossed 5.6% on Tuesday, reaching its highest level since June 2002, while the 10-year yield climbed to nearly 5.3%, its highest level since 2007. The rise in yields pushed the Dow down more than 100 points, while the S&P 500 and Nasdaq slipped 0.2% and 0.1%, respectively.

Markets elsewhere showed a mixed but generally positive tone. In Europe, the Stoxx 600 gained 0.74%, with the U.K.’s FTSE 100 and Italy’s FTSE MIB both advancing 0.76%. Germany’s DAX rose 0.63%, while France’s CAC 40 added 0.23%. In Asia, Japan’s Nikkei 225 jumped 1.94%, Australia’s S&P/ASX 200 gained 0.92% and China’s CSI 300 rose 0.29%, although South Korea’s Kospi declined 0.48%.

Investors also received some relief from comments by New York Federal Reserve President John Williams, who said there was “no need for urgency” ahead of the Fed’s October meeting. The comments helped ease some fears of an immediate rate increase. According to the CME FedWatch tool, traders were pricing in a 49% chance of a quarter-point rate hike next month, down from 71% on Monday.

Attention now turns to the August Personal Consumption Expenditures (PCE) price index, the Federal Reserve’s preferred inflation measure. Economists expect the index to rise 0.3% for the month, taking the annual rate to 3.7%. With September and the third quarter coming to a close, investors are watching inflation, interest rates and bond yields closely as they assess what could shape the next phase of global markets.

source: cnbc