S&P 500 Stalls Near Highs as Tech Enthusiasm Fades

Also, 10-year T-note, gold, crude oil and euro futures

1. S&P 500 E-mini futures (/ES): -0.08% 
2. 30-year T-bond futures (/ZB): -0.36% 
3. Silver futures (/SI): -2.45% 
4. Crude oil futures (/CL): +0.28% 
5. Euro futures (/6E): -0.11% 

Enthusiasm over AI infrastructure buildout hit a bump to day, with the Nasdaq 100 dipping after weak forward guidance from South Korean chipmaker SK Hynix. Stocks are modestly weaker across the board, but the influence of Treasury yields pushing up to their weekly highs can’t be ignored, either. The shift in rates has certainly been felt in the metals market. Elsewhere, energy markets are relatively quiet, with no futures product with a move greater than +/- 1%. 

S&P 500 futures (/ESH5) pulled back this morning after nearly closing at a record high yesterday. American Airlines (AAL) fell 5% in pre-market trading after offering weak guidance. General Electric (GE) rose about 8% after it beat earnings-per-share (EPS) estimates. Alaska Air Group (ALK) rose 2.5% on strong earnings and guidance. Texas Instruments (TXN) will report earnings after the bell today, offering the first look into quarterly results for chip stocks.  

Selling in the Treasury market intensified this morning as investors moved past bullish headlines around investments into the chip sector and shifted back to the threat of tariffs and the possibility that it could derail economic growth. Today’s move in 30-year T-bond futures—down 0.69%—pushed prices into negative territory for the week. The Treasury will auction 10-year treasury inflation-protected securities (TIPS) today.  

Precious metals aren’t digesting the move in yields well, with silver prices (/SIH5) down 2.5% this morning. The advance in yields is likely dissuading investors from the metal even though economic data via jobless claims suggests the Federal Reserve could have more room to cut rates.

Meanwhile, the gold/silver ratio rose to its highest level since February 2024. That could mean it’s a good time to get long silver for those who believe the precious metals market will rebound over the short term.  

Crude oil futures (/CLH5) rose about 0.5% this morning. Traders are waiting for the Energy Information Administration's weekly inventory report after a private report showed crude oil stocks rose nearly 1 million barrels last week.

Meanwhile, traders are assessing the recent developments at the White House after President Trump threatened to place more sanctions on Russia. The prompt spread in the oil futures market contracted further on today, again cutting into substantial gains made earlier this month. The divergence between prices and the spread is discouraging for bulls. If it continues, it could signal weakness in the physical market for oil.   

Euro futures (/6EH5) fell slightly this morning in a rather calm global currency market. Traders expect about four cuts from the European Central Bank (ECB) this year, which is down from the initial bets of five cuts. The slower expected pace in cutting from the U.S. central bank has tempered the outlook for rate cuts in Europe. Traders are also waiting for more certainty about how U.S. trade policy will develop with the new administration. After today, all eyes will be on the rate decision expected tomorrow from the Bank of Japan.   

Christopher Vecchio, CFA, tastylive’s head of futures and forex, has been trading for nearly 20 years. He has consulted with multinational firms on FX hedging and lectured at Duke Law School on FX derivatives. Vecchio searches for high-convexity opportunities at the crossroads of macroeconomics and global politics. He hosts Futures Power Hour Monday-Friday and Let Me Explain on Tuesdays, and co-hosts Overtime, Monday-Thursday. @cvecchiofx

Thomas Westwater, a tastylive financial writer and analyst, has eight years of markets and trading experience. #@fxwestwater
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