Wednesday is a risk-off session for the U.S. stock market as investors express concern in response to the mounting pressures posed by escalating oil prices and increasing U.S. Treasury yields.

WTI-graded crude rose to over $86 a barrel, while the rate-sensitive two-year Treasury yields showcased an impressive 15-basis-point increase in a day, surging over 5%. The ISM Services PMI surprisingly soared to a six-month high in August, beating expectations, while another service gauge measured by S&P Global showed a dismal picture.

The U.S. dollar also increased further, with the U.S. dollar index rising to the 105 level, the highest since mid-March 2023.

Investors are eagerly anticipating the release of the Fed Beige Book at 2 p.m. to gain further insights into qualitative economic data gathered from Federal Reserve districts.

Cues From Wednesday’s Trading:

On Wednesday, the major stock market indices all registered losses: the S&P 500 fell by 0.9%, the Dow Jones Industrial Average dropped 0.7%, the Nasdaq 100 declined by 1.1%, and the Russell 2000 was down by 0.6%.

US Index Performance On Tuesday

Wednesday Trading In Major US Equity ETFs

• The SPDR S&P 500 ETF Trust (NYSE:SPY) was 0.9% lower to $445.38
• The SPDR Dow Jones Industrial Average ETF (NYSE:DIA) fell 0.7% to $373.83 
• The Invesco QQQ Trust (NASDAQ:QQQ) fell 1.2% to $373.83, according to Benzinga Pro data.

Looking at S&P 500 sectors:

Latest Economic Data:

The Mortgage Bankers Association reported a 2.9% drop in weekly mortgage applications volume for the week ended Aug. 25. The MBA Mortgage Market Index fell to the lowest level since December 1996. The drop came despite the 30-year fixed rate’s fall from 7.31% to 7.21%.

At 2 p.m. EDT, the Fed is scheduled to release the Beige Book report, which comprises anecdotal evidence of economic conditions in the 12 Federal Reserve districts.

Dallas Fed President Lorie Logan will make a public appearance at 3 p.m. EDT.

See also: Futures Vs. Options

Stocks In Focus: