US Futures Drop as Bond Yields Surge and Fed Minutes Awaited

U.S. futures dipped on Monday as rising bond yields and the upcoming release of the Federal Reserve's meeting minutes dominated investor attention. The S&P 500 and Dow Jones Industrial Average futures each fell 0.2%, while Nasdaq futures dropped 0.3%. High yields can slow economic growth by increasing borrowing costs, which often drags down stock prices.

The yield on the 10-year U.S. Treasury reached 5.27%, and the 30-year Treasury yield hit 5.63%, both marking more than 20-year highs. Factors driving these increases include persistent inflation, high oil prices, a strong U.S. economy, and rising government debt. Investors are closely watching the Fed's September meeting minutes, released Wednesday, for clues on future interest rate hikes.

This week will also bring key economic data, including reports on the U.S. services sector, unemployment, and consumer sentiment. Meanwhile, RXO Inc. shares surged over 20% after C.H. Robinson Worldwide announced a $5.8 billion cash-and-stock deal to acquire the company. Freight and logistics firms have been raising surcharges due to inflation and high diesel prices.

In energy markets, U.S. crude oil prices fell 0.5% to $90.68 a barrel, while Brent crude rose 0.7% to $102.91. Oil prices have been volatile amid uncertainty over the impact of the Iran war on global supply. European markets showed mixed results, with France's CAC 40 down 0.8%, Germany's DAX up 0.1%, and Britain's FTSE 100 climbing 0.3%. Asian markets were higher, though trading was closed in Shanghai and South Korea for holidays.

In currency trading, the U.S. dollar strengthened to 157.91 Japanese yen, while the euro weakened to $1.1204.