US equities recover while elevated oil and yields keep markets cautious

US equities recovered during Wednesday’s session as technology and financial shares rebounded from recent losses. The S&P 500 and Dow Jones Industrial Average traded around 0.50% higher in the latest Trading Economics update, while the Nasdaq 100 remained slightly below the flatline. Nvidia jumped nearly 5% on reports that it was nearing a $14 billion acquisition of Hugging Face, while Dell surged as much as 10% after beating earnings expectations and raising its revenue guidance. Meta gained 2.50% and Wells Fargo rose 3%, while Palo Alto Networks fell 7% despite reporting better-than-expected results.

US private-sector employment increased by 38 000 in August, below expectations of 47 000 and the weakest rise since January, pointing to softer labour-market momentum ahead of Friday’s jobs report. The US 10-year Treasury yield eased to around 4.79% after rising above 4.81%, although markets continued to price in about a 66% probability of a 25-basis-point Fed rate increase this month.

Oil prices remained elevated as investors assessed ongoing US-Iran hostilities against signs that crude supplies were still reaching the market. Brent crude gained 0.98% to $95.58 per barrel. The US carried out further strikes on Iran, while Tehran reported attacks on US assets across the region. However, US Energy Secretary Chris Wright said 17 million barrels of oil passed through the Strait of Hormuz on Monday, the highest daily volume since the conflict began. Gold recovered 0.94% to $4 369.28 per ounce as the dollar and Treasury yields retreated from recent highs following the softer US employment data. Silver gained 1.17% to $65.01, while platinum was broadly unchanged at $1 766.45 per ounce.

European equities closed slightly lower as high borrowing costs and energy prices continued to weigh on sentiment. The Euro STOXX 50 fell 0.10% to 6 363 and the STOXX Europe 600 declined 0.20% to 646. Utilities came under pressure as European natural gas prices rose, with Enel falling 2.60% and Iberdrola losing 1.20%. LVMH declined 2.50%, while Volkswagen fell almost 4% after it was announced that the carmaker would leave the Euro STOXX 50. The FTSE 100 lost 0.30%.

Asian equities were mostly lower as higher energy prices and government bond yields weighed on sentiment. Japan’s Nikkei 225 dropped 2.85% to 64 325, reaching a four-week low, while Japan’s 10-year government bond yield touched 3% for the first time since 1996. Technology shares were among the weakest performers, with SoftBank Group falling 6.40% and Tokyo Electron losing 3.40%. China’s Shanghai Composite declined 0.97% to 3 941.4 as broader risk aversion outweighed domestic developments, while Hong Kong’s Hang Seng finished broadly flat at 25 311 after recovering from earlier losses.

South African business confidence slipped to 38 in the third quarter from 39 previously, remaining at its lowest level since the third quarter of 2024. Manufacturing confidence also weakened as subdued domestic demand and softer exports continued to affect activity. The local equity market also ended lower, with the FTSE/JSE All Share Index falling 0.67% to 115 082.06 points. Industrials lost 1.49%, while Financials edged 0.04% higher. The rand strengthened 0.66% against the US dollar to R16.06, 0.80% against the British pound to R21.68 and 0.69% against the euro to R18.61.