U.S. Stock Futures Largely Flat Pre-Market as Energy Strengthens and Fixed Income Faces Pressure
Miles Bennett
U.S. equity futures opened roughly flat as Brent crude surged 2.2%-2.5% on a Middle East shipping attack — the oil spike rippled into bonds and currencies, with all eyes now on Wednesday's U.S. July CPI print.
Why did oil prices spike?
A Saudi vessel was attacked near the Bab el-Mandeb Strait by Yemeni armed forces. The UK Maritime Trade Operations body also received a separate incident report involving a tanker and military forces in the Gulf of Oman.
The Houthis have publicly vowed to continue targeting Saudi tankers. This means → the Red Sea–Gulf of Oman shipping risk is not a one-off event but an ongoing threat.
Brent crude jumped roughly 2.2% to 2.5%, making European energy the only sector posting clear gains on the day.
Oil is up — why are bonds selling off?
The chain: oil prices rise → inflation expectations heat up → bond prices fall. In plain terms = costlier oil makes it harder for inflation to cool, so bonds paying a fixed coupon become less attractive.
U.S. Treasury futures slid from 108-09 to 108-04, a peak drop of over 7 basis points. German Bund futures fell about 21 bps; UK Gilt futures dropped roughly 53 bps — the steepest decline.
Overall volumes stayed thin. The market is really waiting for Wednesday's U.S. July CPI and is reluctant to place big bets before then.
Germany auctioned new debt — how did it go?
The German Finance Ministry sold €4.627 billion of federal notes maturing in 2031, coupon 2.90%, average yield 2.93%.
The bid-to-cover ratio was 1.48×, essentially unchanged from the prior auction. This means → demand for Bunds neither worsened nor improved — a middle-of-the-road result.
Bund futures ticked up slightly after the results, suggesting the market had already priced in a worse outcome.
What moved in currencies?
The dollar index tried to extend Monday's gains, pushing toward the 100 round number, but overall moves were muted.
Energy-exporter currencies benefited: the Canadian dollar and Norwegian krone each rose about 0.1%. Sterling, yen, Swiss franc, and euro were roughly flat against the dollar.
The Reserve Bank of Australia held rates steady but tweaked its language — shifting from "prepared to raise if necessary" to "will raise if upside risks materialize" — and cut its inflation forecast. In plain terms = the bar for another hike just got higher. The Aussie dipped briefly, then pared losses to settle down about 10 bps at 0.7050.
What is Nvidia's AI financing platform?
Nvidia confirmed a partnership with Apollo, BlackRock, Blackstone, Brookfield, Goldman Sachs, and KKR to build an AI-infrastructure financing platform targeting over $500 billion in third-party capital.
This means → the AI compute bottleneck is shifting from "who has the chips" to "who can raise the money to build data centers." Nvidia is actively constructing the capital side of the ecosystem.
What else to watch tonight and this week?
After-hours focus: earnings from CoreWeave and Super Micro Computer. CoreWeave previously said returns on data-center capacity investment should begin materializing in H2 2026 — the market will zero in on its guidance.
The week's pivotal data point: Wednesday's U.S. July CPI — the key test of the inflation trajectory and the Fed's policy path.
Background signal: Fed Governor Waller is reportedly focused on inflation-side data ahead of the September meeting. This reflects a reality where a hotter-than-expected CPI could quickly cool September rate-cut expectations.
Content is for reference only, not financial advice.