S&P 500 Futures consolidate recent losses amid pullback in US 10-year Treasury yields


  • S&P 500 Futures pick-up bids near the weekly low, US 10-year Treasury yields ease from yearly top.
  • US-China trade headlines, America-Iran tussle fail to get major attention amid global bond rout.
  • US stimulus chatters, PCE data will be eyed, bond coupon moves keep the driver’s seat.

S&P 500 Futures retrace from the weekly low while rising to 3,840, up 0.30% intraday, during early Friday. The risk barometer marked the heaviest drop in a month the previous day as global markets got swayed by the slump in the bond coupon. However, the latest pullback in Treasury yields seems to have offered US stock futures’ an immediate relief.

The US 10-year Treasury yields rose to the highest since February 2020 while those from Japan, Australia and New Zealand also refreshed the multi-month tops the previous day. The moves ignored central bankers’ efforts to tame the reflation fears and took a tool on Wall Street.

It’s worth mentioning that the jump in the yields also favored the US dollar index (DXY) to stage the strongest comeback in seven weeks while also exerting downside pressure on commodities and Antipodeans.

Recently, news of the US trade warning to China and missile attack on Iran-backed militant group couldn’t impress markets. Though, US House Speaker Nancy Pelosi’s hint to include a minimum wage hike in the $1.9 trillion covid relief stimulus seems to have helped the counter-trend traders.

That said, stocks in Asia-Pacific remain offered while gold prints mild gains and WTI stays depressed by press time.

Given the market’s attention on the global bond performance, the US covid aid package updates and the US Core Personal Consumption Expenditure (PCE)-Price Index for January will be the key to watch. It should also be noted that any surprise announcements by central bankers, especially the Fed, will also have their impact on the market moves and must not be missed.

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