US stock index futures were mixed in early morning trading, after the Dow closed at a record high.
Dow Jones industrial average futures gained 50 points. The S&P 500 futures floated around the flat line, while the Nasdaq 100 futures traded in negative territory.
The move comes after the Dow jumped 425 points on Wednesday to close at a record high in a volatile session that at one point saw an average of 30 shares fall by more than 110 points. The S&P 500 gained 1.1%, while the Nasdaq Composite gained 1%. Earlier in the session, the technology index fell 1.3%.
Rising rates weighed on equities at the start of the session as the 10-year US Treasury yield exceeded 1.4% and peaked in February 2020. Higher rates could spur investors to turn stocks and become bonds. Higher rates could also affect the growth-oriented technology sector.
“Our bottom line is that rates will continue to rise due to rising inflation and inflation expectations and, ultimately, the normalization of the Federal Reserve,” said Ryan Detrick, chief market strategist at LPL Financial. “We also believe that if rates move too fast too fast, the Fed will step in to ensure that rising rates do not become too restrictive and disrupt stock markets or the real economy,” he said.
Yields fell sharply after Federal Reserve Chairman Jerome Powell continued to downplay the threat of inflation.
“It seems pretty clear to us that the rate hike has been driven by growing optimism about economic growth, and rates are finally ‘recovering’ from the stock’s growth prospects,” said David Lefkowitz. head of Americas shares at UBS Global Wealth Management. “So equity investors should not be overly concerned.”
In terms of data, the initial numbers of unemployment claims will be released on Thursday at 8:30 AM ET, economists surveyed by the Dow Jones expecting a print of 845,000. Also at 8:30 AM ET, the US Department of Commerce will release a second estimate for fourth-quarter GDP.
It will also be a day full of earnings, with a number of companies publishing results on a quarterly basis. Best Buy, Papa John’s and Domino’s Pizza are among the names on the deck before the opening bell. Following the market closure, Salesforce.com, Beyond Meat, Etsy and Caesars Entertainment are among the reporting names.
The new public companies Airbnb and DoorDash are also scheduled to report earnings on Thursday after the closing bell.
Sign up to CNBC PRO for exclusive statistics and analysis, and live scheduling on weekdays around the world.