The US stock index fell during Wednesday night’s overnight trading, accelerating losses in the regular trading session, which saw major averages end in the red.
Dow Jones industrial average futures fell 62 points. S&P 500 futures and Nasdaq 100 futures fell 0.3% and 0.5%, respectively.
Shares posted large losses during regular trading, as rising bond yields scared investors. The S&P 500 fell 1.3%, while the Dow Jones industrial average closed 119 points, or 0.38%, lower. The Nasdaq Composite performed relatively poorly, falling 2.7% as technology names declined. The index is about to record its third consecutive negative week – the longest series of weekly losses in September.
The weakness came as the 10-year Treasury yield increased. The reference rate rose to a high of 1.49% on Wednesday before easing slightly. Last week, yields rose to a high of 1.6% in a move that some have described as “rapid” growth.
“Our current strategy work suggests robust economic growth this year, with modest inflation rising,” said Scott Wren, senior global equity strategist at the Wells Fargo Investment Institute. “In trying to read the tea leaves, the increase in the yield curve, in our opinion, reflects the market’s belief that growth and inflation should continue to return to adequate levels as the pandemic eases. We consider this to be positive for stocks and other risky assets, such as commodities, “he added.
During Wednesday’s session, a highlight was the companies related to the reopening of the economy. Actions by airline and cruise line operators advanced after President Joe Biden said on Tuesday that the United States would 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 aid package adopted by the House on Saturday.
“Our macro team sees the economy as spring, given additional vaccinations and incentives,” Keith Lerner, Truist’s chief market strategist, wrote in a note to customers. “The consumer’s ability and desire to spend on services and experiences should lead to the best growth we’ve seen in over 35 years.”
On Thursday, investors will take another look at the ongoing economic recovery, when data on unemployment claims for the week ending February 27 will be released for the first time. Economists surveyed by the Dow Jones forecast 750,000 applicants for the first time.
In terms of earnings, BJ’s Wholesale and Kroger are among the names that report before opening, while Broadcom, Costco and Gap are on deck to provide quarterly updates after the closing bell.
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