Retail sentiment on Stocktwits turned ‘bearish’ on SPY and QQQ amid escalating tensions in the Middle East and rising oil prices and Treasury yields.
- Escalating U.S.-Iran tensions pushed oil toward $95 a barrel and the 10-year Treasury yield above 4.8%, reviving inflation and rate-hike concerns.
- Mohamed El-Erian warned that persistently high yields could shift market concerns from interest-rate risk toward credit risk.
- Investors now turn to ADP jobs data, factory orders and the Fed’s Beige Book Wednesday, ahead of Friday’s closely watched August jobs report.
U.S. stock futures pointed to a soft open on Wednesday as geopolitical escalations in the Middle East weighed on investor confidence.
As of 4:30 a.m. ET, Nasdaq futures were down 0.2%, while S&P 500, Dow and Russell 2000 futures were flat.
On Tuesday, U.S. strikes on Iranian targets near the Strait of Hormuz pushed WTI crude past $90 and Brent near $96. President Donald Trump said the attacks were retaliation for Iran’s attempted mining of the critical waterway and missile strikes targeting U.S. forces in Jordan.
Treasury Yields Add To The Pressure
The rise in crude is spilling directly into the bond market. The 10-year Treasury yield climbed to 4.8%, its highest level since November 2023, while the 30-year yield moved above 5.28%.
Economist Mohamed El-Erian sounded a warning, saying the bigger concern is that if higher yields persist, markets could begin worrying about interest-rate risk morphing into credit risk. Peter Schiff said that the combination of higher oil, rising Treasury yields, and a weakening labor market leaves the Federal Reserve in a difficult position: easing could worsen inflation, while staying tight could increase economic and financial stress.
Retail Traders Turn Bearish On SPY, QQQ
On Stocktwits, retail sentiment for the SPDR S&P 500 ETF (SPY), an exchange-traded fund that tracks the S&P 500 Index, has flipped to ‘bearish’ from ‘bullish’ a day ago, and Invesco QQQ Trust (QQQ), which tracks the Nasdaq-100 Index, has declined to ‘bearish’ from ‘neutral’.
Tech Stocks To Watch
Nvidia (NVDA): Reports suggest that it is in advanced talks to acquire AI platform Hugging Face for up to $14B.
Micron Technology (MU), SanDisk (SNDK) and SK Hynix (SKHY): Memory stocks too remained under pressure in early premarket trade.
Dell Technologies (DELL): Shares rose 10% in early premarket trade after the PC and AI-server maker raised its annual revenue and profit forecasts.
Palo Alto Networks (PANW): Shares fell 1% in early premarket trade despite beating quarterly estimates and forecasting double-digit sales growth for fiscal 2027. Separately, CEO Nikesh Arora also responded publicly to AI safety warnings from OpenAI co-founder Ilya Sutskever about neocloud infrastructure.
Credo (CRDO): Shares fell 9% in early premarket trade despite beating Q1 estimates, as Wall Street flagged gross margin compression and customer concentration risks.
Oracle (ORCL): Shares fell over 1% in early premarket trade after TD Cowen cut its price target to $240 from $300, though retail investors remain optimistic ahead of its October Investor Day.
Among tech earnings to watch today are Broadcom (AVGO), Snowflake (SNOW), Hewlett Packard Enterprise (HPE) and C3.ai (AI).
Trending Stocks
Tesla (TSLA): Remains on the retail radar ahead of its September 3 robotaxi event.
AST SpaceMobile (ASTS) is on the retail radar after hitting a one-month low despite a regulatory disclosure showing insider buying.
Rocket Lab (RKLB): Shares fell over 2% in early premarket trade following news that NASA awarded a $700M Mars telecom contract to rival Blue Origin. Separately, ARK Invest bought 480.8k shares on Tuesday’s dip.
Nio (NIO): The EV maker said it plans to target average monthly Q4 deliveries above 40,000 units in its earnings call, but Wall Street remains skeptical of the recovery case. Bank of America trimmed its price target.
Palantir (PLTR): Palantir is in focus after winning a U.S. Army production contract for eight TITAN ground systems on Tuesday.
GE Aerospace (GE): Won a $2.87 billion U.S. Navy logistics contract and a Defense Innovation Unit hypersonic test bed contract.
Strategy (MSTR): Alliance Global initiated coverage of Strategy with a Buy rating and $217 price target. It expects a “bull run” in bitcoin over the next 6-18 months given “scarcity and increased demand as the regulatory picture becomes clearer.”
Other tickers trending on Stocktwits at the time of writing included United States Oil Fund (USO), Vera Therapeutics (VERA), Terawulf (WULF), and Abercrombie (ANF).
What Else To Watch Wednesday
On the economic front, investors will watch the release of the factory orders, ADP non-farm employment data, and the Federal Reserve’s Beige Book today. This comes ahead of the crucial jobs report due on Friday. Markets are now pricing a 68% chance of a rate hike at the Fed’s September 16 meeting, according to CME FedWatch.
On the earnings front, FuelCell Energy (FCEL), Ollie’s Bargain Outlet (OLLI), Sprinklr (CXM), Daktronics (DAKT), G-III Apparel (GIII), and Brown-Forman (BF.B), among others, report before the bell. Meanwhile, Broadcom (AVGO), Snowflake (SNOW), Hewlett Packard Enterprise (HPE), ChargePoint (CHPT), C3.ai (AI), NetApp (NTAP), Five Below (FIVE), Petco (WOOF), PVH Corp (PVH), and others report after market close today.
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