Stocks Pressured by Higher Bond Yields

The S&P 500 Index ($SPX) (SPY) today is down by -0.59%, the Dow Jones Industrials Index ($DOWI) (DIA) is down by -0.40%, and the Nasdaq 100 Index ($IUXX) (QQQ) is down by -0.97%.  December E-mini S&P futures (ESZ25) are down -0.55%, and December E-mini Nasdaq futures (NQZ25) are down -0.95%.

Stock indexes are moving lower today, pressured by higher bond yields and a selloff in cryptocurrencies.  The 10-year T-note yield is up +7 bp to 4.08% on negative carryover from a surge in 10-year Japanese bond yields to a 17-year high after Bank of Japan (BOJ) Governor Ueda offered his clearest signal yet that the BOJ could raise interest rates again at this month’s BOJ meeting.  Bitcoin is also down by more than -5% today, at a 1-week low, weighing on market sentiment. 

The price of Bitcoin (^BTCUSD) is down more than -5% today at a 1-week low after the People’s Bank of Chian (PBOC) said Saturday that “risks of speculation and hype surrounding virtual currencies have resurfaced” and that virtual currencies do not have the same legal status as fiat currencies, lack legal tender status, and should not be used as currency in the market.   Bitcoin also came under pressure on comments from the CEO of Strategy, who said that his firm could sell Bitcoin if its mNaV, the ratio of enterprise value to the value of Bitcoin holdings, goes below 1x. 

Market attention this week will focus on today’s Nov ISM manufacturing index, which is expected to increase by +0.3 to 49.0.  On Wednesday, the Nov ADP employment change is expected to increase by +10,000.  Also, Sep manufacturing production is expected to rise by +0.1% m/m, and the Nov ISM services index is expected to fall by -0.4 to 52.0.  On Thursday, weekly initial unemployment claims are expected to climb by +6,000 to 222,000.  On Friday, Sep personal spending is expected to increase by +0.3% and Sep personal income is expected to climb +0.3% m/m.  Also on Friday, the Sep core PCE price index, the Fed’s preferred inflation measure, is expected to climb by +0.2% m/m and +2.8% y/y. Finally, the University of Michigan's Dec consumer sentiment index is expected to climb by +1.0 to 52.0.   

The markets are discounting a 100% chance of another -25 bp rate cut at the next FOMC meeting on December 9-10.

Q3 corporate earnings season is drawing to a close as 475 of the 500 S&P companies have released results.  According to Bloomberg Intelligence, 83% of reporting S&P 500 companies exceeded forecasts, on course for the best quarter since 2021.  Q3 earnings rose +14.6%, more than doubling expectations of +7.2% y/y. 

Overseas stock markets are mixed today.  The Euro Stoxx 50 is down -0.55%.  China’s Shanghai Composite climbed to a 1-week high and closed up +0.65%.  Japan’s Nikkei Stock 225 closed down -1.89%.

Interest Rates

December 10-year T-notes (ZNZ5) today are down by -12 ticks.  The 10-year T-note yield is up by +6.9 bp to 4.083%.  T-notes are under pressure today from a slump in 10-year Japanese government bonds to a 17-year low after BOJ Governor Ueda signaled the BOJ could raise interest rates at his month’s policy meeting.  Also, today’s rally in WTI crude oil to a 1-week high has boosted inflation expectations, a bearish factor for T-notes. 

European government bond yields are moving higher today.  The 10-year German bund yield climbed to a 1-week high of 2.736% and is up by +4.1 bp to 2.729%.  The 10-year UK gilt yield is up +2.5 bp to 4.465%.

The Eurozone Nov S&P manufacturing PMI was revised downward by -0.1 to 49.6 from the previously reported 49.7, the steepest pace of contraction in 5 months.

ECB Governing Council member and Bundesbank President Nagel said, "Our projections suggest that interest rates in the Eurozone are currently in a good place."

Swaps are discounting a 3% chance for a -25 bp rate cut by the ECB at its next policy meeting on December 18.

US Stock Movers

Cryptocurrency-exposed stocks are under pressure today, with Bitcoin down by more than -5% at a 1-week low.  Strategy (MSTR) is down more than -7% to lead losers in the Nasdaq 100, and Coinbase Global (COIN) is down more than -5% to lead losers in the S&P 500.   Also, Riot Platforms (RIOT), MARA Holdings (MARA), and Galaxy Digital Holdings (GLXY) are down more than -5%. 

Casino stocks with exposure to Macau are moving higher today after Macau's Nov gaming revenue rose +14.4% y/y.  Wynn Resorts Ltd (WYNN) is up more than +3% to lead gainers in the S&P 500.  Also, Las Vegas Sands (LVS) and Melco Resorts & Entertainment Ltd (MLCO) are up more than +2%. 

Energy producers and energy service providers are climbing today as the price of WTI crude rose to a 1-week high.  Valero Energy (VLO) is up more than +2%.  Also, Diamondback Energy (FANG), Devon Energy (DVN), ConocoPhillips (COP), Halliburton (HAL), Phillips 66 (PSX), Marathon Petroleum (MPC), Chevron (CVX), and Occidental Petroleum (OXY) are up more than +1%. 

Sionna Therapeutics (SION) is down more than -11% after RBC Capital Markets downgraded the stock to underperform from sector perform with a price target of $24.

Coupang (CPNG) is down more than -5% as the company faces an investigation from South Korean authorities over a data breach that affected about 33.7 million customer accounts. 

Joby Aviation (JOBY) is down more than -5% after Goldman Sachs initiated coverage on the stock with a recommendation of sell and a price target of $10.

Shopify (SHOP) is down more than -4% after Oppenheimer said the pace of spending at the e-commerce firm moderated through Sunday during the Black Friday promotional period.

Moderna (MRNA) is down more than -3% to lead vaccine maker slower after William Blair flagged a report from the FDA that links Covid-19 vaccines in younger people to deaths associated with myocarditis. 

Leggett & Platt (LEG) is up more than +9% after Somnigroup International proposed to acquire all outstanding shares of the company for $12 per share 

Chime Financial (CHYM) is up more than +6% after Goldman Sachs upgraded the stock to buy from neutral with a price target of $27.

Synopsys (SNPS) is up more than +3% to lead gainers in the Nasdaq 100 after Nvidia said it invested $2 billion in the company after announcing a multi-year strategic partnership with the company.

Walt Disney (DIS) is up more than +1% to lead gainers in the Dow Jones Industrials after its Zootopia 2 movie pulled in $272 million in China over the weekend, the second-biggest opening ever for a foreign film.

Earnings Reports(12/1/2025)

Credo Technology Group Holding (CRDO), Dakota Gold Corp (DC), Lifezone Metals Ltd (LZM), Lionsgate Studios Corp (LION), MongoDB Inc (MDB), Simulations Plus Inc (SLP), Spire Global Inc (SPIR), Triller Group Inc (ILLR), Vestis Corp (VSTS).