North American Morning Briefing: Stock Futures Fall, Dollar Strengthens as Investors Look for Safety

Stock futures were lower Monday as investors looked for safety, pushing

the dollar close to an 18-month peak against a basket of currencies and sending Treasury yields lower.

Political pressures mounted on markets across the globe, with French budget pressures added to by Spanish leader Pedro Sanchez's call for a snap election Monday. French government bond yields have climbed to their highest levels since 2002, while the euro fell.

Oil prices were little changed following an agreement Friday by G-7 countries to release crude and diesel reserves.

"The still-negative mood across global bond markets remains in the headlines despite cooling energy prices," Swissquote said. "If the bond selloff continues this week, major indices could find it difficult to maintain their gains."

Meanwhile, the Federal Reserve's minutes for its September meeting due on Wednesday will be in focus this week as investors gauge the likely timing of a further interest-rate hike following weak jobs data last week.

"The uptick in the unemployment rate and the pullback in wage growth could set the tone for financial markets in the coming weeks, as the U.S. labour market data is not adding to inflationary concerns," XTB said.

Investors will also be keeping an eye on the two service purchasing managers indexes set for release, with the S&P Global version due at 9:45 a.m. and the Institute for Supply Management's at 10 a.m.

Stocks to watch

Shares in Nubank, the Brazilian digital bank, rose almost 10% in New York premarket as part of a rally in Brazilian stocks after a first-round victory last night by presidential candidate Flávio Bolsonaro.

Schneider Electric, which develops AI data centers, agreed to buy U.S. industrial-software maker PTC in a deal that values it at $23 billion. PTC stock rocketed 35% premarket, while Schneider shares fell 9% in Paris.

XP's stock also soared over 15% ahead of the opening bell.

Watch For:

ISM Report on Business Services PMI for September;

Today's Top Headlines/Must Reads:

- How Gas, Diesel and Electricity Prices Are Squeezing American Voters

- These Energy Companies Put Oklahoma City on the Map. Now They're Moving to Texas.

- The Mighty American Consumer Is Crashing Through Inflation and Driving Growth

MARKET WRAPS Forex:

The dollar rose, hovering close to a near 18-month peak reached overnight against a basket of currencies and supported by expectations for interest-rate rises and French fiscal concerns.

The greenback could extend gains against the euro if the recent widening in the OAT-Bund spread persists, OCBC said. "Wider peripheral spreads tend to tighten eurozone financial conditions and weigh on [euro] sentiment," it added.

The euro fell to a 16-month low against the dollar, weighed by France's fiscal woes. The currency's decline over the past days reflects the cyclical outperformance of the U.S. versus the rest of the world, and in particular versus the euroarea economy, said Bank J. Safra Sarasin.

Bonds:

Treasury yields fell after U.S. nonfarm payrolls rose just 29,000 and the unemployment rate increased to 4.2% in September, according the U.S. Bureau of Labor Statistics on Friday.

Higher bond yields are hitting rate-sensitive sectors first, Saxo Markets said. Utilities and real estate sectors face higher refinancing costs and stronger competition from bonds, it added.

Energy:

Front-month Brent crude was down 0.9%, while WTI futures declined 1.5%.

Metals:

Gold prices rose after recent soft U.S. economic data sharply lowered expectations of a Federal Reserve rate hike in October, though a stronger dollar limited gains.

TODAY'S TOP HEADLINES

Schneider Electric to Buy Software Maker PTC for $22.6 Billion

France's Schneider Electric agreed to buy PTC in an all-cash deal that values the U.S. industrial-software maker at $22.6 billion, moving to prepare its portfolio for industrial artificial intelligence.

Schneider said Monday that it offered $205 a share in cash for PTC, a 42% premium to its last closing price. PTC's board decided to recommend that the company's shareholders approve the deal.

Warren and Hawley to Probe Insurers Over Zero-Payout Claims

Two senators, one a Democrat and one a Republican, are opening a probe into how leading home and auto insurers process claims, following a Wall Street Journal investigation into the rising chances of no payout.

Sens. Elizabeth Warren (D., Mass.), a member of the Senate Banking Committee, and Josh Hawley (R., Mo.) wrote Friday to six of the biggest insurers. The letters seek data and explanations for the increasing risk faced by many Americans that a claim will result in no payment.

Shionogi to Acquire IntraBio for $2 Billion

Shionogi has agreed to acquire Austin, Texas-based drugmaker IntraBio for $2 billion.

The Japanese drugmaker said Monday that IntraBio's expertise would strengthen Shionogi's capabilities across its rare disease pipeline.

Robotics Startup RobCo Hits $1 Billion Valuation

German robotics startup RobCo has sold shares in a deal that values the company at more than $1 billion-double the level hit earlier this year-highlighting investor enthusiasm for physical AI systems.

The company makes autonomous industrial robots aimed at automating repetitive manual tasks like stacking pallets and weighing raw materials. Its new flagship product is a two-armed, self-learning robot called Alfie that is designed to mimic a human working on a factory floor.

French Bond Yields Stay Elevated, Treasury Yields Ease

French government bond yields rose on Monday, staying at elevated levels not far below Friday's multiyear highs, amid building concerns over the country's indebtness.

Treasury yields eased meanwhile after weaker-than-expected U.S. nonfarm payrolls data caused markets to trim expectations for another U.S. interest-rate increase in October.

What Bessent is now saying after bond yields didn't stop rising on 'I am the house' remark

Treasury Secretary Scott Bessent is projecting a more humble view after failing to jawbone the bond market.

In an interview last month, Bessent told investors, "I am the house now," and warned bond-market bears to bet against him if they wanted.

ECB's Lane Sees 'Demand Destruction' Muting Energy Impact On Inflation

The recent rise in energy prices may cool demand in the eurozone through a variety of channels that would limit the need for rate rises to contain inflation, European Central Bank Chief Economist Philip Lane said Monday.

The ECB last month raised its key interest rate for the second time since the start of the war between the U.S. and Iran in late February. Investors expect to see further increases in borrowing costs following data released last week that showed eurozone inflation reached a three-year high in September.

FBI Arrests Alleged Chinese Agent Accused of Spying on Son of Taiwan Leader

The FBI arrested a California realtor on Sunday on charges of acting as an unregistered agent of China, accusing her of spying on a son of Taiwan's president under the direction of Chinese officials.

The alleged foreign agent, Wanying Zhang, a 34-year-old resident of Irvine, Calif., was arrested at Los Angeles International Airport before she could board a flight to Shanghai, U.S. authorities said.

Spanish Leader Calls Snap Elections in Bid to Turn Housing Crisis Into Votes

Spanish Prime Minister Pedro Sánchez called for snap elections Monday, gambling that anger over high rents and toward right-wing lawmakers who blocked legislation to ease the housing crisis will galvanize support for his socialist party.

Sánchez, who has led a left-wing minority government since 2023, cast the election as a stark choice between securing a "broader progressive majority" in parliament or opening the door to Spain's most right-wing government since military dictator Francisco Franco died in 1975.

Flávio Bolsonaro Surges Past Lula, Setting Up a Bitter Brazil Election Runoff

SÃO PAULO-Flávio Bolsonaro dealt President Luiz Inácio Lula da Silva a bruising first-round defeat Sunday, finishing ahead of the leftist leader and putting Brazil's right within reach of taking back power in Latin America's largest nation.

Flávio Bolsonaro, a 45-year-old senator and the eldest son of imprisoned former President Jair Bolsonaro, received 47.3% of votes, short of the 50% needed for an outright victory, while da Silva got just 44.8% with 98% counted late Sunday. Other right-wing candidates won a combined 5%, leaving the 80-year-old incumbent fighting for his political survival ahead of the Oct. 25 runoff.

Multiple Security Failures Allowed FlyDubai Pilot Into Cockpit

DUBAI-Before Hamam al-Hammami stood behind his captain on FlyDubai Flight 1073 and raised an emergency ax to begin the assault that nearly brought down the plane, there had been ample opportunity for authorities in three countries to keep him from getting anywhere near that cockpit.

Oman had scrutinized his online habits and decided he showed too much interest in radical ideology to trust as a pilot at state carrier Oman Air, where he worked. They banned him from flying, sent him to a deradicalization program and put him in a desk job but didn't flag their concerns more broadly, people familiar with the matter said.

Write to priscila.barrera@wsj.com

TODAY IN CANADA Earnings:

Nothing major scheduled.

Economic Indicators (ET):

Nothing major scheduled.

Stocks to Watch:

Ithaca Energy to Buy Offshore Canada Oil Assets From Suncor Energy for Up to $1.1 Billion

Sunshine Biopharma Offering Up to 10.2M Common Units;Units Will Each Contain a Share and Two Series D Warrants

Expected Major Events for Monday 00:30/JPN: Sep Japan Services PMI

05:00/JPN: Sep Consumer Confidence Survey

06:00/RUS: Sep Russian Services PMI

(MORE TO FOLLOW) Dow Jones Newswires

October 05, 2026 06:11 ET (10:11 GMT)