US stock futures were stable in night trading on Monday, following rising bond yields that put pressure on market growth pockets.
Dow Jones Industrial Average Futures fell by only 20 points. S & P 500 futures were flat and Nasdaq 100 futures were down 0.2%.
NS 10-year Treasury yield Rising from economic optimism and concerns about inflation, it temporarily exceeded 1.5% on Monday, the highest level since June.
Stocks saw uneven sessions in the midst of a surge in rates.
The Dow Jones Industries average on Monday scored 71 points, with the small cap Russell 2000 up 1.5%. However, the S & P 500 decreased by 0.3%. Nasdaq Composite was relatively sluggish, down 0.5% as the fall in bond prices put pressure on growth names such as: Microsoft When Amazon..
“The stock market is increasingly showing that the US economy has entered a new resumption cycle,” said Jim Paulsen, chief investment strategist at Reuthold Group.
“The revival of Covid-led economic activity could exacerbate supply chain problems and ultimately rekindle concerns about inflation, but so far, investors have too much growth and technology, We need to reassess whether economically sensitive investments are inadequate, “Paulsen added.
Traders were also staring at the testimony from Federal Preparatory Commission Chair Jerome Powell.Central Bank Chief with prepared remarks to be delivered on Tuesday Inflation could last longer than expected..
“Inflation is rising and is likely to continue to rise in the months before it eases,” Powell said. “As the economy resumes and spending continues to recover, supply bottlenecks, especially in some sectors, are putting upward pressure on prices. These effects are greater than expected and last longer, but they are. The same goes for softening and inflation. It is expected to recede towards the long-term 2% target. “
The central bank showed last week that it was ready to start a “taper”. This is the process of slowly pulling back the stimuli provided during the pandemic. The federal government left the price unchanged, Probably one rate hike In 2022, followed by three in 2023 and three in 2024.
The possibility of a government closure also clouded the market on Monday.
Legislators must act on a funding plan before the government faces a closure on Friday. There may be a temporary solution to extend funding, but the bigger problem of raising the debt cap may not be resolved for a few more weeks. Senate Republicans funded the government on Monday to block a bill to suspend US debt caps.
Wall Street is also looking forward to Thursday when House is expected to vote for $ 1 Trillion Bipartisan Infrastructure Bill Already approved by the Senate.
Thursday is the last day of trading in September and the third quarter. Dow was down 1.4% that month and S & P 500 was down 1.8%. Nasdaq Composite lost 1.9% in September.
Covid-19 delta variants, federal reserve tapering plans, and inflation have plagued investors. However, Dow is still up nearly 14% so far, despite its weakness in September. The S & P 500 and Nasdaq are also significantly higher.
“I think the wall of concern has continued to grow,” said Lindsey Bell of Ally Invest, CNBC’s “Closing bell“On Monday.” There are very legitimate concerns from market participants, but I think one thing is … consumer strength. While inflation can come, consumers are resilient. “
— With report from Patti Domm of CNBC.
Correction: In previous versions, Lindsey Bell’s name was misspelled.
Stock futures are flat as investors are measuring spikes in bond yields
Source link Stock futures are flat as investors are measuring spikes in bond yields