US stock market today: Wall Street futures slip as tech rout, Iran tensions and bond yields weigh

The US stock market traded lower on Monday, 24 August, as a retreat in technology and chip stocks, escalating tensions in the Middle East and persistent pressure from elevated long-dated US bond yields kept investor sentiment fragile.

Dow Jones Industrial Average futures slipped marginally by 11 points, while futures tied to the S&P 500 and Nasdaq-100 fell 0.1% and 0.5%, respectively.

In the previous week, US stocks went through a roller-coaster ride as surging bond yields fuelled concerns about the health of the economy, pushing the 30-year US Treasury yield to 5.3%, its highest level in nearly 20 years.

Investors grew increasingly concerned that the US-Iran war could continue for longer, keeping oil prices elevated and potentially driving inflation higher. Treasury Secretary Scott Bessent did announce measures to help stabilise the long end of the US yield curve, but the reprieve proved short-lived.

Higher bond yields can slow the economy and undermine valuations across various asset classes.

Investors are also awaiting comments from Kevin Warsh regarding interest rates and other policy issues in a key speech at the annual gathering of US economic leaders in Jackson Hole later this week.

The Federal Reserve has been struggling to bring inflation back to its 2% target. Inflation has crept higher after the US imposed a wide range of tariffs globally and has climbed further as the Iran war disrupted global oil shipments through the Strait of Hormuz.

Investors will get an important inflation update on Wednesday when the US releases its July report on personal consumption expenditures, or PCE, the Federal Reserve's preferred measure of inflation. Much like the consumer price index, the PCE data has shown that US consumer inflation remains stubbornly above 3%.

US prepares 'single greatest financial offensive' against Iran

The US will unveil “the single greatest financial offensive ever” against Iran on Monday, Treasury Secretary Scott Bessent said. Writing in the Financial Times, Bessent said Washington was launching the “single greatest financial offensive marshalled against an adversary”, describing it as an “economic D-Day”.

The measures will target Tehran and could also ensnare countries that continue to deal with the Islamic Republic, potentially including China.

Washington aims to increase economic pressure on Iran and push Tehran towards negotiations over the conflict, its nuclear programme and control of the Strait of Hormuz.

In response to the US economic threats, Iran once again said that fresh sanctions would not bring peace to the region. Iran's Foreign Ministry spokesperson on Monday warned that Tehran would respond harshly to expanded US sanctions, including measures against countries it sees as cooperating with Washington, according to AP.

Oil prices retreat

Oil prices slipped after recording strong gains last week as traders shifted their focus to the US announcement of fresh sanctions against Iran. Brent crude futures were down 4% at $90.30 per barrel, while WTI crude also fell more than 3% to $84.79 per barrel.

The US move to intensify economic pressure on Iran comes after months of military strikes and a full naval blockade of Iranian ports failed to force Tehran to capitulate. However, the Islamic Republic has faced sanctions for years, raising questions about what additional measures Washington could introduce to further pressure its economy.

Meanwhile, Iran reportedly said it had blacklisted 45 tankers that had violated its rules for crossing the Strait of Hormuz and would take action against any vessels transferring cargo to or from them. The move escalates Tehran's threats over the strategically important waterway six months into the war, Reuters reported.

(With inputs from AP and Reuters)

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