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US Index Futures Drop Amid Rising Treasury Yields and Inflation Concerns, Oil Prices Increase

Fernanda T
Latest News
May 29 2024 7:28AM

U.S. index futures are down in pre-market trading this Wednesday, after the Nasdaq Composite reached a new record in the previous session. Investors are focused on rising Treasury yields and increasing inflation concerns.

As of 6:25 AM, Dow Jones futures (DOWI:DJI) fell 219 points, or 0.56%. S&P 500 futures dropped 0.56%, and Nasdaq-100 futures lost 0.58%. The 10-year Treasury yield was at 4.564%.

In the commodities market, West Texas Intermediate crude for July rose 0.78% to $84.88 per barrel. Brent crude for July increased by 0.77% to near $84.86 per barrel. Iron ore traded on the Dalian exchange fell 1.11% to $125.30 per metric ton.

On Wednesday’s economic agenda, the Federal Reserve’s Beige Book will be released at 2 PM, along with comments from Federal Reserve members. At 1:45 PM, New York Fed President John Williams will participate in a panel. At 7 PM, Atlanta Fed President Raphael Bostic will speak.

European markets are operating lower, reacting to their worst session in a month the previous day. Investors are focused on the outlook for interest rate adjustments and are attentive to the rise in global bond yields.

Asian markets mostly closed lower on Wednesday, following mixed behavior on Wall Street after the holiday. Japan’s Nikkei index fell 0.77% to close at 38,556.87 points, impacted by losses in electronics and machinery sectors, while the 10-year Japanese government bond yield hit 12-year highs, driven by the prospect of more restrictive monetary policy by the Bank of Japan. Other notable declines include the Hang Seng index in Hong Kong, which fell 1.83%, South Korea’s Kospi, which dropped 1.67%, and Australia’s ASX 200, which closed with a loss of 1.30%. In China, the Shanghai index saw a slight increase of 0.05%, benefiting from new stimulus measures for the real estate sector in major cities.

On Tuesday, the Nasdaq and Dow Jones had mixed performances. The Nasdaq, after a brief afternoon dip, recovered and closed at a record high of 17,019.88 points. The Dow Jones fell 0.55% to 38,852.86, while the S&P 500 edged up just 0.02% to 5,306.04. The Nasdaq, which declined in afternoon trading influenced by Treasury yields, was boosted by a 7.1% rise in Nvidia (NASDAQ:NVDA) shares. Economically, the consumer confidence index for May jumped to 102.0 from a revised 97.5 in April. The recovery surprised economists, who had expected the consumer confidence index to decrease to 95.3, compared to the initially reported 97.0 for the previous month.

Scheduled to report quarterly earnings before the market opens are Dick’s Sporting Goods (NYSE:DKS), Abercrombie & Fitch (NYSE:ANF), Chewy (NYSE:CHWY), Advanced Auto Parts (NYSE:AAP), Bank of Montreal (NYSE:BMO), CollPlant Biotechnologies (NASDAQ:CLGN), Nordio American Tankers (NYSE:NAT), Columbus McKinnon (NASDAQ:CMCO), Allot Communications (NASDAQ:ALLT), Mediwound (NASDAQ:MDWD), among others.

After the market closes, results from Salesforce (NYSE:CRM), C3.ai (NYSE:AI), UiPath (NYSE:PATH), Okta (NASDAQ:OKTA), Nutanix (NASDAQ:NTNX), PureStorage (NYSE:PSTG), Agilent Technologies (NYSE:A), HP (NYSE:HPQ), American Eagle (NYSE:AEO), American Superconductor (NASDAQ:AMSC), and more will be awaited.