Stock futures climbed while Treasury yields were sliding Thursday,

largely reversing Wednesday's selloff following the Federal Reserve's first rate hike in three years.

Stocks had sold off while yields jumped after the Fed's rate decision Wednesday, with Fed Chairman Kevin Warsh warning that inflation remains "too high and has been for too long." His comments raised the prospect of further rate hikes to come.

"It was important to see a united Fed, which draws a line under any potential market concerns around Fed credibility," Impax Asset Management said. "One more hike penciled in for later this year will be well received by the market."

Meanwhile, Brent crude prices were trading below $105 a barrel on hopes that disruption to Middle Eastern oil exports from a damaged Saudi pipeline may not be as severe as initially feared.

Looking ahead, investors will be keeping an eye on U.S. housing starts data for August and the U.S. pending home sales index due today. Elsewhere, the Bank of England is expected to keep interest rates on hold.

Stocks to watch

Diamondback Energy's largest shareholder sold nearly $2 billion worth of shares Tuesday, according to securities filings. Shares fell 8% yesterday and are ticking lower in premarket trading.

ExxonMobil was close to signing a preliminary deal to explore investments in several Venezuelan oil fields, negotiating a potential return to the country nearly two decades after its exit.

Generac Holdings was up more than 30% in premarket trading after the backup-power company signed a $2.4 billion deal to sell data-center generators to Amazon.

Lennar cut its home delivery target for the full year, citing interest rate pressure and worsening conditions in the housing market, as its revenue and profit fell in the third quarter. Shares fell premarket.

Watch For:

U.S. Housing Starts for August; U.S. Weekly Jobless Claims; U.S. Philadelphia Fed Business Outlook Survey for September; U.S. Pending Home Sales for August; Canada Industrial Product and Raw Materials Price Indexes for August

Today's Top Headlines/Must Reads:

- Saudi Arabia Has Another Option to Get Its Oil Out

- The Startup That Built OpenAI's Biggest Data Center Is Now Making Tiny Ones

- Why the BOE and Fed Are On Different Rate Paths as Iran War Spikes Inflation

MARKET WRAPS Forex:

The dollar eased slightly but remained elevated after reaching a one-and-a-half-month high overnight. "The greatest danger for the dollar lies in the president increasing pressure on the Fed again in the coming weeks, which could lead to renewed doubts about the Fed's independence," Commerzbank said.

Sterling rose. The BOE could refrain from raising interest rates on Thursday and at upcoming meetings, leaving sterling vulnerable to potential falls, Commerzbank said.

Bonds:

Treasury yields were little changed in early trade, absorbing the Fed's decision and the prospect of more tightening to come.

Energy:

Brent crude futures fell 1.4%, while WTI declined 1.1%. Both benchmarks were down Wednesday, with Brent settling 2.7% lower and WTI losing 3.2%.

Metals:

Gold slipped after trading higher in early trade. Its price trajectory is increasingly dependent on the pace of U.S. interest increases, MUFG said.

Iron ore

Iron ore prices were higher in early trading despite a fundamentally weak outlook. Demand remains subdued, with low end-user consumption and widespread losses among steel mills fueling expectations of production cuts and a negative feedback loop for iron ore demand, Baocheng Futures said.

TODAY'S TOP HEADLINES

OpenAI Shares More Safety Incidents and Adopts New Rules for Reporting Them

An OpenAI model undergoing testing rewrote its own instructions, telling itself to disregard "the roles and identities that bind other chatbots." An AI agent tried to pass a test by uploading a file to the internet, then citing it as a source. Another agent couldn't find the data to create a financial model, so it instructed itself to make up the data and "be transparent only if asked."

OpenAI disclosed these and other previously unreported incidents on Wednesday as the company announced a new framework for reporting instances of misbehavior by its artificial-intelligence models.

Exxon Is Nearing Preliminary Deal to Invest in Venezuela's Oil Fields

ExxonMobil is close to signing a preliminary deal to explore investments in several Venezuelan oil fields, negotiating a potential return to the country nearly two decades after its exit.

Exxon could sign a memorandum of understanding with state-run Petróleos de Venezuela as soon as this month to explore a deal to invest in a number of developed and undeveloped fields, according to people familiar with the matter. The deal talks could still fall apart or extend beyond September, the people said.

The World Isn't Ready for an Anthropic IPO

Most CEOs spend the weeks before an initial public offering pitching investors, strategizing with bankers, and putting the final touches on their IPO prospectus. Anthropic's Dario Amodei has spent much of his time warning that artificial intelligence-the technology his company helped pioneer-may have catastrophic risks.

"If we build in the wrong way, the probability of something bad happening is very high," Amodei said in an interview on CBS News Sunday Morning. He warned, among other things, of AI models going rogue and launching cyberattacks, as one group of OpenAI agents recently did, and about humans misusing AI to create biological weapons. Not once in the 24-minute interview did Anthropic's IPO come up.

Carmaker Volvo Car Mounts 13-Model Product Push to Revive Fortunes

Volvo Car said it is making its largest-ever product push, launching 13 new car models by the end of the decade in an effort to revive its fortunes.

The Swedish carmaker-which is majority-owned by China's Zhejiang Geely Holding Group-on Thursday laid out its roadmap to navigate a tough auto market and deliver on its long-term goals of driving sales growth and higher profitability.

Oil Prices Slip After Fed's First Rate Hike in Three Years

Oil prices fell again in early European trading Thursday after the Federal Reserve raised interest rates for the first time in three years, while expectations that Saudi Arabia could restore some disrupted export capacity eased immediate concerns over Middle Eastern supplies.

Brent crude futures fell 1.4% to $104.31 a barrel, while West Texas Intermediate declined 1.1% to $100.28 a barrel. Both benchmarks were down Wednesday, with Brent settling 2.7% lower and WTI losing 3.2%.

Taiwan Central Bank Holds Rates Steady Despite Higher Energy Costs

Taiwan's central bank kept interest rates unchanged for a 10th consecutive quarter.

The decision was expected to be a close call, with economists polled by The Wall Street Journal nearly evenly split on whether policymakers would raise rates or hold the line.

Why the BOE and Fed Are On Different Rate Paths as Iran War Spikes Inflation

The Bank of England probably won't serve up any shocks on Thursday, but its policy decision is still likely to put it at odds with both the Federal Reserve and the European Central Bank.

The BOE is expected to keep interest rates unchanged at 3.75%, having done the same at its last meeting in July. The Fed hiked borrowing costs on Wednesday, matching the ECB's move last week.

Saudi Arabia Has Another Option to Get Its Oil Out

Militants have taken out what has arguably become the most important oil pipeline in the world.

A way to ferry crude through the Strait of Hormuz, along with Saudi Arabia's track record of fixing damaged infrastructure quickly, are now the best hope to cool oil prices.

Saudi Arabia Has Another Option to Get Its Oil Out

Militants have taken out what has arguably become the most important oil pipeline in the world.

A way to ferry crude through the Strait of Hormuz, along with Saudi Arabia's track record of fixing damaged infrastructure quickly, are now the best hope to cool oil prices.

Iran's Attempts to Get Around the Hormuz Blockade Are Hitting a Wall

Iran vowed to respond to a U.S. blockade by pushing more trade overland. On the ground, it isn't going according to plan.

Hundreds of Iranian truck drivers are currently stuck at Iran's border with Pakistan, unable to send their goods into Tehran's neighbor. They say they are facing worsening bureaucratic hurdles and costs, many caused by their own government. The same thing is happening at Iran's land borders with Turkey, Turkmenistan and Afghanistan, dealing Tehran a self-inflicted blow and throttling trade through its few remaining economic release valves.

Trump Says Allowing Canada to Become Associate Member of EU Could Be 'Hostile Act'

WASHINGTON-President Trump said Wednesday that allowing Canada to become an associate member of the European Union could be a "hostile act" and threatened additional tariffs on European countries.

The president said that the proposition was "laughable" and described Canada as a "terrible trade partner." The comments came after the EU's top official said she would work to make Canada the bloc's first associate member. In a speech at the European Parliament with Canadian Prime Minister Mark Carney in attendance, European Commission President Ursula von der Leyen said Europe needed to tighten its cooperation with like-minded democracies, in particular Canada.

See How Jet Power Is Giving Russia the Edge in the Drone War

The latest revolution in drone warfare is jet powered.

Russia's one-way attack drones-known as Gerans-are now equipped with turbojet engines. Relatively inexpensive to make, they are evading Ukrainian air defenses and hunting down their targets more quickly than their propeller-powered predecessors.

Write to priscila.barrera@wsj.com

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