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Downward momentum continues during Thursday’s premarket trading session after Wednesday snapped Wall Street’s two-day fourth quarter rally. Early on and stock futures point lower as investors show a risk-off tone with yields ticking higher and the dollar index gaining ground.
Dow futures (INDU) are -0.4%, while S&P futures (SPX) are -0.5%, and Nasdaq futures (NDX:IND) have slid 0.4%.
In the the bond market, Treasury yields have slightly risen. The 10-year Treasury yield (US10Y) is up 1 basis point to 3.76% and the 2-year Treasury yield (US2Y) has gained 2 basis points to 4.17%.
The dollar index is also up 0.25% as it trades near the 111.35 level.
Talks of a Fed pivot has increased towards the beginning of the week where Wall Street rallied to start the fourth quarter, but has since subsided as major averages retrace lower. For the next Fed meeting futures are now pricing in a 71.4% chance that markets will see a 75-basis point hike compared to a 28.6% that are factoring a 50% rate hike.
On the economic calendar, initial jobless claims figures are due out before the opening bell with economists forecasting 203K claims, which would be elevated from the previous week’s reading of 193K.
Among active movers shares of Microsoft have drifted lower after reportedly planning an investment in Indian play-to-earn gaming platform Zupee.
