Future stock indices fell mainly on Friday, with tech-related stocks set to lead the decline, as bond yields continue to rise, a day after the Dow Jones Industrial Average and the S&P 500 closed at levels records.
What are the main benchmarks doing?
-
Futures at the Dow Jones Industrial Average YM00,
+ 0.10%
rose 63 points, or 0.2%, to 32,431. -
S&P 500 future ES00,
-0.42%
fell 9.30 points, or 0.2%, at 3,918. -
Nasdaq-100 future NQ00,
-1.53%
fell 151.75 points, or 1.2%, to 12,887.25.
The Dow DJIA,
on Thursday it rose 188.57 points, or 0.6%, to close at 32,485.59, based on the record close from the previous session, while the S&P 500 SPX,
recorded its first record since February 12, increasing 1% to 3,939.34. The Nasdaq Composite COMP,
jumped 2.5%.
What is driving the market?
A rebound in technology-related stocks prompted stocks to rise on Thursday, but a further increase in Treasury yields on Friday, with the 10-year note rate TMUBMUSD10Y,
jumping over 8 basis points for trading above 1.61%, it was set to send growth-oriented stocks back to the downside in the week’s final session.
Need to know: See how far Nasdaq can fall if bond yields reach 2%
It has been a volatile week for stocks, including Nasdaq, which recorded gains or losses of more than 2% in three trading sessions.
“We believe that the recent stock volatility should continue, as investors seek to balance growing optimism about growth with concerns about rising inflation,” said Mark Haefele, chief investment officer at UBS Global Wealth Management, in a note.
“But while we expect conditions to remain volatile, the most recent developments in three of the main drivers of the market – stimulus, news about the pandemic and inflation data – point to a greater appreciation of stocks,” he said.
President Joe Biden signed a $ 1.9 trillion COVID-19 aid package on Thursday. In a televised speech on Thursday night, Biden promised to make all adults eligible for vaccines by May 1.
The combination of aggressive fiscal spending and progress in launching vaccines stimulates economic growth, but also potentiates inflation, at least in the short term.
Analysts said technology stocks may also be vulnerable to pressure after China’s market regulator said on Friday that it imposed fines on some of the country’s biggest technology companies.
In addition, Bloomberg reported that the Biden administration has informed some suppliers to China’s Huawei Technologies Co. that it would impose stricter conditions on previously approved export licenses, preventing the use of items on or with 5G devices.
Meanwhile, with American wholesale inflation in February, the producer price index rose by 0.5%, as expected. Excluding food volatility and energy prices, they rose 0.2% in the month, compared to expectations of a 0.3% increase, according to Econoday. On an annualized basis, the main PPI index rose 2.2% last year from 2% the previous month.
The preliminary University of Michigan consumer sentiment index for March is due to be released at 10 am. It is expected to rise to 78.9 from a February reading of 76.8.
Which companies are in focus?
-
Actions of Ulta Beauty Inc.
ULTA,
-7.58%
it fell more than 8% in pre-market trade after reporting lower sales and profit in the fourth quarter on Thursday. It also announced that chief executive Mary Dillon will be replaced by the company’s chairman, David Kimbell. -
GoodRx Holdings Inc.
GDRX,
-11.09%
the shares fell 4.8% after the healthcare company reported adjusted earnings that were above Wall Street expectations, but aimed at lower sales in the first quarter. -
DocuSign
DOCU,
-3.91%
were under pressure in the pre-market trade, even after the electronic authentication company released a better-than-expected quarterly outlook in its most recent quarterly report. -
Novavax
NVAX,
+ 11.27%
says his vaccine COVID is effective against variants of the deadly virus. -
Actions of GameStop Corp.
GME,
+ 6.93%
rose 3.9% in Friday’s pre-market after a 1.9% drop in the previous session, on an otherwise mixed morning for other meme stocks. -
Boeing Co. BA,
+ 1.75%
received an order from a private investment firm 777 Partners to buy 24 737 MAX planes with an option to purchase an additional 60, according to a Reuters report.
How are the other assets doing?
-
The ICE US Dollar Index DXY, a currency measure against a basket of six major rivals, was up 0.5%.
-
Oil futures traded slightly lower, with the American benchmark CL.1 falling less than 01% to $ 65.97 a barrel. The GC00 future gold was down $ 18.70, or 1.1%, to trade at $ 1,703.90 an ounce on Comex.
-
The Stoxx 600 Europe SXXP pan-European index was traded 0.4% lower and London’s FTSE 100 UKX was barely in positive territory, up less than 0.1%.
-
In Asia, the Hong Kong Hang Seng HSI Index fell 2.2%, the Shanghai Composite Index SHCOMP rose 0.5%, China’s CSI 300 000300,
+ 0.35%
rose 0.4%, while Japan’s NIK Nikkei 225 rose 1.7%. -
Bitcoin prices BTCUSD,
-2.88%
fell 4% to $ 55,506 in trading at CoinDesk.