US Stock Futures Fall Ahead of Fed Meeting as Oil and Treasury Yields Rise: Dow Jones, S&P, Nasdaq, Wall Street

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US stock futures moved lower on Tuesday ahead of the Federal Reserve’s two-day monetary policy meeting, while investors also monitored higher oil prices, Treasury yields and developments in the Middle East.

At 03:20 ET, Dow futures were down 266 points, or 0.5%, while S&P 500 futures declined 28 points, or 0.4%. Nasdaq 100 futures fell 90 points, or 0.3%.

Wall Street’s main indices also declined in the previous session. Semiconductor shares moved lower, with the Philadelphia Semiconductor Index recording its largest daily decline since July.

The benchmark 10-year US Treasury yield moved above 5% for the first time since 2023 as investors assessed the potential inflationary impact of higher energy prices.

“It was another session where September lived up to its reputation as the worst month of the year for asset performance, with bonds and equities continuing to struggle,” Deutsche Bank analysts said.

The analysts said they would also monitor US Treasury Secretary Scott Bessent’s testimony to the House Financial Services Committee “to see if he tries to lean in some credible way against the rising tide of bond yields.”

The Federal Reserve was due to begin its two-day policy meeting on Tuesday, with its interest-rate decision scheduled for Wednesday.

Markets were pricing in approximately a 92% probability of a 25-basis-point rate increase, according to CME FedWatch. Such a move would take the federal funds target range to between 3.75% and 4%.

Deutsche Bank analysts said markets were also pricing approximately 90 basis points of rate increases by the Fed’s June 2027 meeting, two basis points more than the previous day.

Recent US economic data have shown continued inflationary pressures alongside resilience in the labour market, factors investors are considering when assessing the outlook for monetary policy.

Oil prices extended recent gains as investors monitored developments affecting Middle Eastern supply routes.