After ending the previous session mostly higher, stocks may move back to the downside in early trading on Thursday. The major index futures are currently pointing to a lower open for the markets, with the S&P 500 futures down by 26 points.
A pullback by tech stocks may weigh on the markets, with the Nasdaq futures moving sharply lower amid another spike in U.S. treasury yields.
The yield on the benchmark ten-year note has jumped above 1.7 percent to reach its highest levels since last January, while the thirty-year bond yield has surged up to its highest levels since last summer.
Yields are skyrocketing despite yesterday’s assurances by the Federal Reserve that interest rates will remain at near-zero levels through 2023.
Analysts have attributed the jump in yields to concerns that the Fed’s apparent willingness to let inflation accelerate more than normal will reduce the appeal of bonds. Yields move in the opposite direction of bond prices.
Traders are also reacting to a report from the Labor Department showing an unexpected increase in first-time claims for U.S. unemployment benefits in the week ended March 13th.
The report said initial jobless claims climbed to 770,000, an increase of 45,000 from the previous week’s revised level of 725,000.
The rebound came as a surprise to economists, who had expected jobless claims to edge down to 700,000 from the 712,000 originally reported for the previous week.
Meanwhile, a separate report released by the Philadelphia Federal Reserve showed its reading on regional manufacturing activity spiked to a nearly 50-year high in March.
Reflecting a positive reaction to the Federal Reserve’s highly anticipated monetary policy announcement, U.S. stocks ended Wednesday’s trading mostly higher. With the upward move, the Dow and the S&P 500 reached new record closing highs.
The major averages all finished the day in positive territory, with the tech-heavy Nasdaq showing a significant rebound after moving sharply lower in early trading.
After tumbling by as much as 1.5 percent, the Nasdaq ended the day up 53.64 points or 0.4 percent to 13,525.20. The Dow also advanced 189.42 points or 0.6 percent to 33,015.37 and the S&P 500 rose 11.41 points or 0.3 percent to 3,974.12.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Thursday. Japan’s Nikkei 225 Index jumped by 1 percent, while China’s Shanghai Composite Index climbed by 0.5 percent.
Meanwhile, the major European markets are turning in a mixed performance on the day. While the German DAX Index is up by 0.9 percent, the French CAC 40 Index is nearly unchanged and the U.K.’s FTSE 100 Index is down by 0.2 percent.
In commodities trading, crude oil futures are sliding $0.72 to $63.88 a barrel after slipping $0.20 to $64.60 a barrel on Wednesday. Meanwhile, after falling $3.80 to $1,727.10 an ounce in the previous session, gold futures unchanged.
On the currency front, the U.S. dollar is trading at 109.10 yen versus the 108.84 yen it fetched at the close of New York trading on Wednesday. Against the euro, the dollar is valued at $1.1927 compared to yesterday’s $1.1979.
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