Dow Notches Third Straight Losing Week as 10-Year Yield Sits Near 5%, Futures Edge Up Ahead of Trump-Xi Summit

U.S. stock futures ticked up slightly Sunday night, according to CNBC, with S&P 500 and Nasdaq-100 futures both rising roughly a quarter of a percent and Dow futures up 0.25%. That followed a rough week on Wall Street: the Dow Jones Industrial Average fell more than 1.5% for its third consecutive losing week, its worst stretch since March, according to CNBC and Yahoo Finance. The S&P 500 slipped about 0.1% for the week even after a 0.2% gain Friday, while the Nasdaq Composite was the lone bright spot, up roughly 0.7% for the week on a snapback in chip stocks.

The market is still digesting the Federal Reserve's quarter-point rate hike last week, its first in three years, according to CNBC. Fed Chairman Kevin Warsh's committee has tied its inflation outlook to oil prices settling down, LPL Financial chief economist Jeffrey Roach wrote, according to CNBC. Kansas City Fed President Jeff Schmid said there's still "work to do" on inflation, according to Yahoo Finance. The 10-year Treasury yield has climbed to hover near 5%, with traders now betting on another hike in October, Yahoo Finance reported.

JPMorgan Chase CEO Jamie Dimon told Yahoo Finance this week that "it's not clear to me we've slayed inflation." Oil prices eased just below $100 a barrel as the war in Iran approaches its seventh month, per Yahoo Finance, offering some relief even as the Strait of Hormuz disruptions keep complicating the inflation picture for central banks.

Middle East tensions escalate again

Over the weekend, Iran-backed Houthis said they struck Saudi Arabia with missiles and drones, according to CNBC. The U.S. State Department responded by warning Americans to reconsider traveling to the Middle East, as Washington and Tehran traded threats to resume attacks. None of the available reporting draws a direct line between that weekend escalation and Sunday night's modest futures gain. The two are happening at the same time, not necessarily because of each other.

That instability lands right before a consequential summit. President Donald Trump and Chinese President Xi Jinping are set to meet this week to cover tariffs, critical minerals, and artificial intelligence, according to CNBC. Treasury Secretary Scott Bessent has been meeting with Chinese Vice Premier He Lifeng ahead of that visit. With oil still elevated and the Fed in no rush to cut, the outcome of those talks carries more weight than it otherwise would.

The AI money machine keeps running, but momentum is fading

Epoch Times flagged a real divergence inside the market itself: the S&P 500 Momentum Index, which tracks about 100 of the market's fastest-rising stocks, has fallen roughly 9% since July 1 even as the broader S&P 500 climbed nearly 4% over the same stretch. Natalia Lojevsky, managing director at CIFC Asset Management, told Epoch Times that "at some point, higher interest rates do start to bite," warning rate-sensitive sectors, especially tech, are most exposed.

U.S. IPOs have raised $145.8 billion this year, already topping the $142.4 billion raised in all of 2021, Willy Lee of Neostellar Capital Corp. told Epoch Times. Alphabet, Amazon, Meta, Microsoft, and Oracle raised a combined $255 billion in debt and equity by early June, more than double their combined 2025 total, largely to fund AI infrastructure, Lee said. Anthropic has a highly anticipated NYSE debut on the horizon, though Epoch Times noted that some other AI-linked stocks have pulled back sharply from their post-IPO highs, a caution flag for how these debuts can perform once the hype settles.

Critics have pointed to a "circular ecosystem" where AI companies invest in each other and then funnel that money back into each other's products, inflating valuations without matching real revenue. Epoch Times reported investors have largely waved off that worry so far. What does cut against the bear case: 86% of S&P 500 companies beat Wall Street earnings estimates last quarter, according to FactSet data cited by Epoch Times, which is why the broader index has kept climbing even as narrower momentum names slide.

Elsewhere, bitcoin surged 6% to top $81,000 Friday, according to Yahoo Finance, as investors shrugged off the failure of the CLARITY Act and short sellers were forced to cover positions. In Asia early Monday, the Kospi and Kosdaq opened higher while Australia's ASX 200 slipped 0.49%; Japan's markets were closed for a holiday, CNBC reported.

The open question heading into the week: whether the Trump-Xi summit produces anything concrete on tariffs and critical minerals that eases the inflation math the Fed keeps citing, or whether oil near $100 and a widening Middle East conflict keep Warsh's committee locked into another hike in October.