Stock futures rise to Dow record

Investors’ demand for equities revived as bond markets calmed down. The yield on 10-year treasury notes, which is reversing the price, fell from 1,520% on Wednesday to 1,502%, putting it on course for a third consecutive day of declines. Yields climbed to 1.594% earlier this week.

Shares are plunged by sharp gains in bond yields, fueled by uncertainty over how the $ 1.9 billion bill passed by the House on Wednesday will ripple through the U.S. economy.

Concerns that the size of the stimulus would increase inflation outside the comfort zone of the Federal Reserve and cause an interest rate hike have recently raised yields. It lost the appetite for shares in technology companies, which benefited from a long period of low rates. At the same time, optimism about the economic outlook has boosted demand for shares in companies that would benefit from the easing of the closures.

Muted inflation data for the beginning of the year calmed the nerves about the outlook for rates. But bond yields are likely to remain volatile and shift momentum between different segments of the stock market, said Monica Defend, head of research at French asset manager Amundi.

“Ultimately, it should be positive for the stock market if we have a little more inflation and a little more growth,” she said.

Technical stocks, including Apple, Twitter and data mining firm Palantir Technologies, climbed ahead of the clock in New York. Oracle fell 4.5% after the software giant dropped earnings late on Wednesday.

Shares of video game retailer and online trading sensation GameStop fell about 9% ahead of the market. Volatility has returned in recent sessions to the so-called meme stocks, the darling of individual investors meeting on internet forums.

Data on the number of persons applying for unemployment benefits, a proxy for unemployment, must be presented at 08:30 ET. Economists polled by The Wall Street Journal expect 725,000 workers to submit initial benefits last week. This will be a small decrease compared to the previous week and provide a further sign of improvement in the labor market after a softening of the Covid-19 case numbers.

“As far as the unemployment rate is concerned, we are not quite out of the woods yet,” said Mary Nicola, a portfolio manager at PineBridge Investments. Labor health will be an important determining factor when the Fed decides to raise interest rates, she added.

Investors’ appetite for US sovereign debt will be tested again on Thursday with the planned auction of $ 24 billion in 30-year bonds. The Treasury sold $ 58 billion in three-year notes on Tuesday and $ 38 billion in 10-year notes on Wednesday.

In overseas markets, the Stoxx Europe 600 rose 0.3%.

The euro rose 0.3% to $ 1.1964 ahead of the European Central Bank’s latest monetary policy decision, scheduled for 07:45 ET. Investors expect ECB President Christine Lagarde to address the recent rise in regional yields in the region during the ensuing press conference. The bank will also publish its quarterly economic forecasts for the eurozone.

“The eurozone can not afford tighter financial conditions, and we are importing it from the higher rates in the US,” she said. Defend said. “This is something the ECB is worried about.”

The Chinese Shanghai Composite Index rose 2.4% in its biggest one-day rise since October. The advance follows an article in a financial newspaper that encourages new investors to seek long-term returns and not be affected by volatility in equities, Deutsche Bank strategist Jim Reid said in a note.

Markets rose elsewhere in Asia, with Japan’s Nikkei 225 and South Korea’s Kospi up 0.6% and 1.9% respectively.

Write to Joe Wallace by [email protected]