Stock futures lower after major averages dip amid rising bond yields


U.S. stock index futures were little changed during overnight trading on Wednesday, after stocks finished the session in the red across the board.

Futures contracts tied to the Dow Jones Industrial Average slid 4 points. S&P 500 futures and Nasdaq 100 futures declined 0.05% and 0.01%, respectively.

Stocks posted heavy losses during regular trading as rising bond yields spooked investors. The S&P 500 dipped 1.3%, while the Dow Jones Industrial Average closed 119 points, or 0.38%, lower. The Nasdaq Composite was the relative underperformer, falling 2.7% as tech names declined. The index is on track to post its third straight negative week — the longest weekly losing streak since September.

The weakness came as the 10-year Treasury yield extended gains. The benchmark rate climbed to a high of 1.49% on Wednesday before retreating slightly. Last week, the yield surged to a high of 1.6% in a move that some described as a “flash” spike.

“Our current strategy work suggests robust economic growth this year with a modest increase in inflation,” noted Scott Wren, senior global equity strategist at Wells Fargo Investment Institute. “In attempting to read the tea leaves, the steepening of the yield curve, in our opinion, reflects the market’s belief that growth and inflation should continue to move back toward appropriate levels as the pandemic eases. We view this as a positive for stocks and other risk assets, like commodities,” he added.

During Wednesday’s session, one bright spot was companies tied to the economy’s reopening. Shares of airline and cruise line operators advanced after President Joe Biden said Tuesday that the U.S. will have enough Covid-19 vaccines for all adults by the end of May.

Additional stimulus measures could also inject optimism into the market. The Senate is currently debating the $1.9 trillion relief package passed by the House on Saturday.

“Our macro team sees the economy as spring loaded given the vaccinations and additional stimulus,” Keith Lerner, Truist chief market strategist, wrote in a note to clients. “The ability and desire of the consumer to spend on services and experiences should lead to the best economic growth we have seen in over 35 years.”

On Thursday investors will get another look at the ongoing economic recovery when first-time jobless claims data for the week ending Feb. 27 is released. Economists surveyed by Dow Jones are forecasting 750,000 first-time filers.

On the earnings front, BJ’s Wholesale and Kroger are among the names reporting before the open, while Broadcom, Costco and Gap are on deck to provide quarterly updates after the closing bell.

Subscribe to CNBC PRO for exclusive insights and analysis, and live business day programming from around the world.



Source link

Discover

Sponsor

Latest

Unity and Palantir stock jump after debut earnings reports

The New York Stock Exchange welcomes Unity Software Inc. (NYSE: U) Friday, September 18, 2020, as they officially begin trading today.NYSEUnity and Palantir...

2022 BMW iX First Look: Bavaria’s EV SUV Challenger Enters the Arena

We drove the electric Jaguar I-Pace from London to Berlin in mid-2018, before scooting through the deserts of Abu Dhabi Audi’s electric powered...

Nvidia cryptocurrency mining processor for Ethereum announced

Jensen Huang, president and CEO of Nvidia, speaks during the company's event at the 2019 Consumer Electronics Show in Las Vegas on Jan....

Snapchat paying $1 million a day to popular video creators

Evan Alberto has made almost a million dollars from SnapchatCourtesy of Evan AlbertoEvan Alberto says he's on track to become a millionaire in...

Traders pick out top shares to ride travel rebound

Changes are coming to travel amid the coronavirus pandemic.The Transportation Security Administration says it will now issue fines to travelers who failed to...