Investors heading into the August 26 trading session are tracking a heavy slate of US economic data, shifting US public support for the war with Iran, falling oil prices, and moves in the bond market. Durable Goods, GDP, PCE and consumer spending figures are due, alongside Federal Reserve commentary later this week.

US Markets Open Higher as Yields Ease

US stocks opened higher on Tuesday, August 25, as Treasury yields eased and semiconductor shares recovered. Dow futures rose 0.6%, S&P 500 futures gained 0.5%, and Nasdaq 100 futures advanced 0.9%. The 10-year Treasury yield fell more than 3 basis points to 4.666%. Nvidia, AMD and Micron gained in premarket trading ahead of Nvidia's quarterly results, which are widely watched as a bellwether for demand for AI-related chips and the broader semiconductor trade. Investors are also tracking economic data and the Federal Reserve's Jackson Hole symposium later this week — the central bank's annual gathering in Wyoming, where the Fed chair's remarks have historically been parsed for signals on the policy path — for clues on the interest-rate outlook.

Heavy Slate of US Economic Data Due on August 26

Markets await a heavy slate of US data on August 26. Durable Goods orders for July, a read on factory demand and business equipment spending, are forecast to fall 0.5% after a 0.3% rise. The second estimate of Q2 GDP, which incorporates more complete source data than the initial print, is expected to be unchanged at 1.5%. Personal Income and Consumer Spending are seen rising 0.2% and 0.1% respectively, both cooling from June. The PCE Price Index, the Federal Reserve's preferred inflation gauge, is projected to rise 0.1% month-on-month and 3.6% year-on-year, with Core PCE at 0.2% M/M and a steady 3.3% Y/Y — still well above the Fed's 2% target. Later, Richmond Fed President Thomas Barkin speaks in Greensboro, offering possible policy commentary.

US Support for Military Action Against Iran Falls to 31%

Public support in the US for military action against Iran fell to 31%, its lowest level since the conflict's early days, according to a Reuters/Ipsos poll. Support declined from 37% in March and 34% earlier this month, with Republican backing falling to 69% from 77%. President Donald Trump's approval rating remained at 33%, the lowest recorded in Reuters/Ipsos polls during his first or second term. Meanwhile, 83% of Americans expect the war to continue for an extended period.

Oil Prices Slide More Than 3%

Oil prices fell more than 3% on Tuesday, extending the previous session's decline, as markets played down the immediate impact of expanded US sanctions on Iran and focused on easing concerns over a broader disruption to Middle Eastern crude supplies. Brent crude fell to $89.25 a barrel, while US West Texas Intermediate (WTI) crude declined over 3% to $82.20. However, supply disruption risks remained, with shipping through the Strait of Hormuz, a chokepoint for a large share of the world's seaborne crude trade, and regional attacks continuing to concern markets.

Treasury Yields Climb as US Debt Crosses $40 Trillion

US Treasury yields have climbed sharply, with the 30-year yield nearing 5.24%, as investors assess rising government debt, elevated fiscal deficits and heavy Treasury issuance. US government debt has crossed $40 trillion, while annual interest payments are approaching $1.2 trillion. Treasury buybacks briefly eased pressure on long-dated bonds, but yields rebounded. The rise in US yields could also affect equities and emerging markets, including India, through higher borrowing costs, a stronger dollar and potential pressure on foreign portfolio flows.

FIIs and DIIs Turn Net Buyers in Indian Equities

Foreign Institutional Investors (FIIs) were net buyers in the Indian equity market on Tuesday, purchasing shares worth ₹1,593.53 crore on a provisional basis. Domestic Institutional Investors (DIIs) also remained net buyers, with purchases worth ₹230.26 crore. Daily FII and DII provisional figures are closely tracked on Indian exchanges as a gauge of foreign and domestic institutional sentiment toward local equities.

Source: CNBC-TV18