US dollar mixed, Treasury yields climb ahead of PPI and CPI

The US dollar closed the North American session mixed, with minimal movement against most major currencies. Against the euro, British pound, Australian dollar and Swiss franc, the greenback saw little change. It weakened against the yen and Canadian dollar, while strengthening against the New Zealand dollar.

The relatively calm currency market reflects traders positioning ahead of the next set of US inflation figures. The Producer Price Index is due on Thursday at 8:30 AM ET, with the Consumer Price Index following on Friday.

The data will influence expectations for the Federal Reserve's policy path. In the meantime, traders seem hesitant to commit to larger positions.

Treasury yields climb

• 2-year yield: 4.3957%, up 1.7 basis points

• 5-year yield: 4.5662%, up 1.6 basis points

• 10-year yield: 4.7922%, up 0.8 basis points

• 30-year yield: 5.2475%, up 0.2 basis points

The steeper rises at the short end of the curve indicate some caution ahead of the inflation data. Above-forecast readings for PPI or CPI would complicate the Fed's ability to ease policy, while weaker numbers would provide more leeway.

US stocks end lower, with Amgen dragging on the Dow

The main US stock indexes ended in the red, led by the Dow Jones Industrial Average.

• Dow industrial average fell 628.04 points, or 1.18%, to 52,791.29

• S&P 500 fell 45.08 points, or 0.58%, to 7,673.53

• Nasdaq Composite fell 85.58 points, or 0.32%, to 26,421.41

• Russell 2000 fell 15.44 points, or 0.52%, to 2,960.20

The Dow's drop was broad, with 24 of its 30 components ending lower. Amgen was the largest negative contributor, sliding $44.06, or 10.08%, to $393.17.

The steep drop came after disappointing data from Novartis' experimental cardiovascular drug pelacarsen. The drug did not reduce cardiovascular events in a phase-three trial, casting doubt on the strategy of lowering lipoprotein(a) (Lp(a)) to cut heart-disease risk. Amgen is working on a similar drug, olpasiran, so the Novartis result is seen as a potential warning for Amgen's program. BMO Capital additionally downgraded Amgen from Outperform to Market Perform, compounding the pressure. Reuters

Other notable Dow losers included:

• Salesforce: -3.86%

• Home Depot: -2.30%

• Sherwin-Williams: -2.25%

• Johnson & Johnson: -2.20%

• Nvidia: -2.01%

On the upside, Caterpillar added 1.05%, UnitedHealth rose 0.94%, and Chevron climbed 0.67%, supported by higher oil prices.

Crude oil bounces back after testing 100-hour moving average

Crude oil had another volatile day. The price first rose to $94.72, then dropped to a low of $91.82. That low occurred just above the rising 100-hour moving average.

The moving average held, encouraging buyers to re-enter. The price then rallied and is near $94.03 late in the session.

The key takeaway is that moving averages need not be touched to the exact cent. Buyers used the technical support area, defined their risk, and were rewarded as the price moved back toward the day's high.

On the fundamental side, Middle East tensions continue to add a significant geopolitical risk premium. Flights were reportedly halted at Jeddah's airport amid a broader escalation in Saudi Arabia. Iran-backed Houthi forces carried out coordinated missile and drone attacks on several southern Saudi cities and energy facilities, injuring 73 and causing fires and operational disruptions. Saudi Arabia called the attacks a dangerous escalation and vowed to respond. InvestingLive report

Separately, explosions were reported around Iran's Kharg Island, a key oil-export hub. The cause of the blasts was not immediately confirmed. Since Kharg Island handles a large share of Iran's oil exports, any disruption to its operations raises global supply concerns. InvestingLive report

The mix of attacks on Saudi energy infrastructure and uncertainty over Kharg Island explains why buyers are still willing to step in on sharp oil price drops.

Gold drops below 100-day moving average

Spot gold declined $68, or 1.55%, to $4,359.89. This is a bearish signal.

The drop pushed the price below its 100-day moving average of $4,364.86. That level now serves as a short-term technical indicator.

If the price remains below the 100-day moving average, sellers will retain control and further downside could be tested. On the other hand, a rise back above the moving average would disappoint sellers and restore some buyer confidence.

Aside from the Middle East news, it was a relatively quiet day as traders awaited the key PPI and CPI data later in the week.