U.S. Stocks May Give Back Ground In Early Trading
After ending the previous session mostly higher, stocks may move back to the downside in early trading on Friday. Technology stocks appear poised for a substantial pullback, with the Nasdaq futures tumbling by 152 points.
The downward momentum on Wall Street comes as traders continue to keep a close eye on activity in the bond markets.
The yield on the benchmark ten-year note has jumped back near 1.6 percent after showing signs of stabilization over the past few sessions.
The increase in yields comes after President Joe Biden directed states to make all adults eligible for a coronavirus vaccine by May 1st.
The vaccine news combined with the new $1.9 trillion stimulus package has generated optimism about the economic outlook, reducing the appeal of bonds. Bond yields move in opposite direction to prices.
Profit taking may also contribute to initial weakness on Wall Street after the Dow and the S&P 500 ended the previous session at new record closing highs.
On the U.S. economic front, the Labor Department released a report showing U.S. producer prices increased in line with economist estimates on the month of February.
The Labor Department said its producer price index for final demand climbed by 0.5 percent in February after spiking by 1.3 percent in January. The price growth matched expectations.
Excluding prices for food, energy, and trade services, core producer prices edged up by 0.2 percent in February following a 1.2 percent jump in January.
The report also showed the annual rate of growth in producer prices surged up to 2.8 percent in February from 1.7 percent in January.
Core producer prices in February were up by 2.2 percent compared to the same month a year ago, reflecting an uptick from the 2.0 percent growth in January.
Shortly after the start of trading, the University of Michigan is scheduled to release its preliminary reading on consumer sentiment in the month of March. The consumer sentiment index is expected to rise to 78.5 in March after dipping to 76.8 in February.
Stocks moved mostly higher during trading on Thursday, with the Dow and the S&P 500 reaching new record closing highs. The tech-heavy Nasdaq showed a particularly strong upward move after ending the previous session slightly lower.
The Nasdaq soared 329.84 points or 2.5 percent to 13,398.67 and the S&P 500 jumped 40.53 points 1 percent to 3,939.34. The Dow pulled back well off its best levels of the day but still closed up 188.57 points or 0.6 percent to 32,485.59.
In overseas trading, stock markets across the Asia-Pacific region moved mostly higher during trading on Friday. Japan’s Nikkei 225 Index surged up by 1.7 percent, while China’s Shanghai Composite Index rose by 0.5 percent.
Meanwhile, European stocks have moved mostly lower on the day, with the pan-European Stoxx 600 falling by 0.4 percent. The German DAX Index is also down by 0.5 percent, while the French CAC 40 Index is nearly unchanged and the U.K.’s FTSE 100 Index is up by 0.1 percent.
In commodities trading, crude oil futures are edging down $0.01 to $66.01 a barrel after spiking $1.58 to $66.02 a barrel on Thursday. Meanwhile, after inching up $0.08 to $1,722.60 an ounce in the previous session, gold futures are slumping $18.90 to $1,703.70 an ounce.
On the currency front, the U.S. dollar is trading at 109.07 yen versus the 108.51 yen it fetched at the close of New York trading on Thursday. Against the euro, the dollar is valued at $1.1921 compared to yesterday’s $1.1986.
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