Nasdaq Futures Hit Multi-Week Highs Despite Yield Spike
Nasdaq futures rise 1.8% as falling crude oil offsets a 38-basis-point jump in 2-year Treasury yields and a stronger US dollar.
Key points
- Nasdaq futures rose 1.8% in two weeks, reaching multi-week highs despite a 38-basis-point spike in 2-year Treasury yields.
- The correlation between Nasdaq futures and Brent crude fell to -0.75, an extreme value compared to the historical average of +0.12.
- The Philadelphia Semiconductor Index gained 7% since September 14, while US industrials remained flat, signaling a rotation into tech.
Nasdaq futures have climbed to fresh multi-week highs, gaining approximately 1.8% over the past two weeks. This upward momentum persists despite a traditionally hostile macroeconomic environment characterized by rising interest rates and currency strength. The index has defied expectations that higher borrowing costs would weigh heavily on long-duration technology stocks.
The rally coincides with a sharp increase in US Treasury yields and a 1% gain in the US dollar index. Typically, such conditions dampen equity valuations, yet tech stocks have maintained resilience. This divergence is largely attributed to improving technical momentum and a distinct rotation of capital away from cyclical sectors toward structural earnings plays in the semiconductor industry.
Crude Oil Drives Tech Correlation Shift
A striking inverse relationship has emerged between crude oil prices and Nasdaq futures. According to data cited by Investing.com, the rolling correlation between daily moves in Nasdaq futures and Brent crude has fallen to approximately -0.75. This figure places the current dynamic near the extreme lower tail of the historical distribution dating back to 1999.
Historically, the average correlation between these two assets is only around +0.12, indicating a generally weak link. The current extreme negative correlation suggests that falling crude prices are acting as a significant macro tailwind for technology stocks. This shift implies that energy cost reductions are providing a direct boost to tech sector margins and investor sentiment.
Semiconductors Outperform Cyclical Industrials
Investors are increasingly favoring AI-linked earnings over sectors sensitive to economic cycles. Since September 14, the Philadelphia Semiconductor Index (SOX) has risen by approximately 7%. In contrast, the US industrials ETF (XLI) has remained broadly flat during the same four-session window.
This performance gap places semiconductor outperformance at the 97th percentile historically. Higher borrowing costs, driven partly by elevated crude prices and the Federal Reserve’s recent hawkish rate hike, are creating headwinds for cyclical firms. Meanwhile, tech stocks benefit from their structural positioning in the AI infrastructure buildout, allowing them to withstand pressure from rising yields.
Technical Momentum Supports Rally
Bearish sentiment has struggled to gain traction despite significant macro headwinds. Doubts about AI demand, combined with higher energy prices and a stronger dollar, provided ample arguments for selling over the past month. However, the market has absorbed these shocks without breaking down.
The continued rise in Nasdaq futures indicates that technical momentum remains a dominant force. The market is currently eyeing the 30,000 level as upside momentum builds. This trajectory suggests that current pricing mechanisms are prioritizing long-term structural growth over short-term macroeconomic volatility, keeping pressure on sellers.
