Morning Wrap: ASX 200 to rise, megacap tech lifts Nasdaq to record, Treasury yields climb to 24-year highs

In a nutshell:

• Major US benchmarks finished higher, but slightly off best levels, Nasdaq breaks out to a fresh all-time high off the back of megacap gains from names like SpaceX (+7.6%), Nvidia (+2.1%) and Broadcom (+2.0%)

• Global bond sell-off deepened, sending 10-year and 30-year Treasury yields to their highest levels since 2002

• Euro fell to a 17-month low against the US dollar on French budget gridlock, while Spain called a snap election for November 29

Let's dive in.

• Major US benchmarks higher but finished off best levels as a rally in megacap tech lifted the S&P 500 towards a record, overshadowing elevated oil prices and bond yields

• Treasuries extended their months-long ascent, with 10-year and 30-year yields up 7 bps to 5.34% and 5.7% intraday, both the highest since 2002, but later settling 3 and 4bps higher at 5.3% and 5.6% respectively

• Brent slipped a second day to around US$100 a barrel and WTI to near US$90 as traders weighed a Saudi-backed offensive against Yemen's Houthis and OPEC+ holding output quotas steady for November

• Euro slid to a 17-month low against the US dollar as French budget gridlock kept the OAT-Bund yield spread around 145 bps, after it hit its widest since 2011 on Friday (YF)

• Brazilian assets rallied after Flávio Bolsonaro narrowly led President Lula in the first round of Brazil's election, with JPMorgan upgrading Brazilian stocks to overweight ahead of the runoff (YF)

• The 30-year Treasury yield crossing 6% is "inevitable" and likely within October as bond-market volatility feeds a cycle pushing rates higher, said BMO Global Asset Management's Earl Davis (BBG)

• With 30-year Treasury yields nearing 6%, the move threatens a shake-up in Treasury futures widely used for hedging and by leveraged funds in the popular basis trade (BBG)

• Elevated oil prices and surging bond yields have derailed a broadening of the equity rally, with a stronger US dollar hampering liquidity and Iran re-escalation risk keeping WTI around $90 (BBG)

• A record 60% of S&P 500 stocks now carry a Buy rating from analysts, according to FactSet, the highest share on record heading into third-quarter earnings season (YF)

• Schneider Electric agreed to buy US industrial software firm PTC for about $22.6bn in cash, or $205 a share, its biggest acquisition to date as it pushes deeper into industrial AI. Schneider shares fell as much as 9.4% in Paris while PTC surged (BBG)

• TSMC shares touched a record high after Elon Musk confirmed early-stage talks on the chipmaker helping his Terafab venture run its Texas semiconductor factories, while Terafab partner Intel fell about 2% (YF)

• SpaceX rose 7.8% in early trade after Morgan Stanley's Adam Jonas reiterated an Outperform rating and $300 price target, calling the stock unusually cheap ahead of Starship Flight 15 (YF)

• Former Anthropic researcher told a NYC Council hearing "we are racing to build and grow our own adversary", with Anthropic, OpenAI, Google and Meta leaders slated to testify (CNBC)

• Cerebras shares rose 9% after OpenAI CEO Sam Altman called the AI chipmaker a "close partner", following a slide in the stock since disappointing August results and guidance (YF)

No major headlines in the last 12 hours.

• ECB chief economist urged a measured response as policymakers assess a second wave of the energy shock, saying renewed pressure poses upside risks to inflation and downside risks to growth (BBG)

• Bundesbank President Joachim Nagel said the ECB must be ready for various inflation outcomes, with a sustained Hormuz reopening easing pressure and renewed escalation risking higher oil and gas costs (BBG)

• Bloomberg Economics said the hurdle for an October Fed rate hike is now high, with FOMC minutes due Wednesday expected to show officials' inflation fears at the September hike (BBG)

• Trump said the US moved B-1 bombers from Britain's RAF Fairford over Iran-linked threats, warning Iran would "suffer greatly" if it brought drones into the UK (AX)

• Iran's Parliament Speaker said the Strait of Hormuz will not reopen until Iran's seven conditions under the Islamabad Memorandum are met, including lifting sanctions and ending the US blockade (CNBC)

• UKMTO said three tankers were hit by unknown projectiles in the Strait of Hormuz over the weekend, while an inbound tanker turned back after an IRGC warning that it would be targeted (CBS)

• ICE will offer tanker freight derivatives on routes from the Gulf of Oman and West Africa as the Iran war upends the oil shipping industry's main benchmark through Hormuz (BBG)

• Saudi Aramco's chief executive warned global oil stockpiles have become "scarily thin", leaving markets at risk unless Hormuz reopens, days after major economies pledged up to 100m barrels of emergency stocks (BBG)

• US ISM services PMI eased to 54.9 in September from 55.4, below ests, marking a 27th straight month of expansion, while prices paid climbed to 74 from 72.6 (YF)

• Australia's S&P Global services PMI was finalised at 51.9 for September, above ests of 51.4 but down from 53.2 in August (TE)

• Civmec secures contract awards and extensions worth more than $220m, headlined by the gallium plant build at Alcoa's Wagerup refinery and Bulk Cargo Terminal works at Glencore's Murrin Murrin. FY27-FY28 delivery lifts the order book to around $1.5bn (CVL)

• DevEx Resources hits 1.7m @ 1,116ppm eU3O8 from 168.8m and 2.3m @ 920ppm from 184m in RC drilling at Nabarlek North, open to the north-west. Hyperspectral work maps a kilometre-scale illite alteration zone along the fault corridor, assays and seismic pending (DEV)

• LGI to acquire 42MW of operating Queensland solar assets for $22m with no debt, adding an estimated $2.1-4.0m of annual EBITDA depending on synergy timing and DACS rollout. Upgrades its medium-term pipeline target to more than 120MW from 80MW (LGI)

• PlaySide Studios estimates 150,000 units sold of Dumb Ways to Build since its 10 September launch for US$1.0m gross and US$0.6m net revenue, ahead of internal forecasts. Steam is two-thirds of units, with net wishlists doubling to over 260,000 (PLY)

• Tower lifts FY26 underlying NPAT guidance to NZ$69-79m from NZ$55-65m after using just NZ$25m of its NZ$45m large event allowance, a NZ$14m after-tax uplift. Customers up 8% to 345,000 and GWP up 3% (TWR)

• Mixed signals. Wall Street has handed us a fairly encouraging lead, but one that again shows how narrow this market is. The Nasdaq closed at an all-time high, while the Dow sits about 6% below its 5 August record. That said, breadth was solid on the day, with the equal-weight S&P 500 trading in line with the cap-weighted index.The problem is everything else. The long end of the curve kept inching higher, with 10- and 30-year yields now at their highest since 2002. The US Dollar Index rose 0.19% to its highest since April 2025, though off a session high of 0.6%. Brent went the other way, down 2.3% to US$100.2 a barrel. So US stocks climbed against a net-negative backdrop for yields, the dollar and oil. That's probably why the Global X Copper Miners ETF rose just 0.49% overnight, despite copper rising 0.9% to US$6.67/lb. You can't complain about a solid lead, but with yields still rising and showing no signs of slowing, the move isn't on firm footing either. Markets remain choppy at best (just look at yesterday's 0.05% close versus a 0.62% session high).

Stocks trading ex-dividend: 

• Tue 6 Oct: Harvey Norman Holdings (HVN) – $0.13, Katana Capital (KAT) – $0.005, Reece (REH) – $0.134, Ridley Corporation (RIC) – $0.053

• Wed 7 Oct: MFF Capital Investments (MFF) – $0.11, Ryder Capital (RYD) – $0.03

• Thu 8 Oct: ARB Corporation (ARB) – $0.35, Clime Capital (CAM) – $0.014, Naos Emerging Opportunities Company (NCC) – $0.021, WAM Capital (WAM) – $0.077

• Fri 9 Oct: EQT Holdings (EQT) – $0.20

• Mon 12 Oct: Civmec (CVL) – $0.035, Washington H. Soul Pattinson (SOL) – $0.63

Other ASX corporate actions today:       

• Dividends paid: Bhagwan Marine (BWN), Big River Industries (BRI), Centrepoint Alliance (CAF), Chorus (CNU), CTI Logistics (CLX), Generation Development Group (GDG), Orora (ORA)

• IPOs: None

• AGMs: None

Economic calendar (AEDT):

• 10:30 am: Westpac Consumer Confidence