Futures rise as yields fall


(Reuters) – U.S. stock index futures rose on Friday as Treasury yields continued to decline from the previous session and with recent weak economic data raising hopes that the Federal Reserve (the U.S. central bank) has likely finished raising interest rates. .

The S&P 500 and Nasdaq posted marginal gains on Thursday on lower Treasury yields after higher-than-expected jobless claims supported some mega stocks, with the yield on the 10-year Treasury note falling on Friday, the latter reaching 4.3849%. [US/]

Some huge stocks rose in pre-market trading, with Amazon.com and Nvidia shares rising 0.6% and 0.5%, respectively.

Wall Street’s three major indexes were on pace for gains of about 2% this week, and are also on track for a third straight week of gains, as multiple data, including the Consumer and Producer Price Index, pointed to an easing of inflationary pressures.

The Labor Department’s weekly jobless claims report on Thursday also helped sentiment, confirming market expectations that interest rates have peaked.

“For now, bad news is good news as the market’s focus is on central banks becoming more accommodative,” Mohit Kumar, chief European economist at Jefferies, said in a note.

While money markets have fully priced in the Fed will keep rates steady at the current 5.25%-5.50% level at its December meeting, they also see a roughly 69% chance of a rate cut of at least 25 basis points in May 2024, according to CME Group’s FedWatch tool.

Investors are now awaiting comments from Fed officials, including policy voting member and Chicago Fed President Austan Goolsbee, scheduled later in the day for any signals on the path of monetary policy.

On the economic data front, markets will be watching October housing starts, scheduled for release at 8:30 a.m. ET.

At 5:44 a.m. EDT, Dow e-minis were up 100 points, or 0.29%, S&P 500 e-minis were up 12 points, or 0.27%, and Nasdaq 100 e-minis were up 13.75 points, or 0.09%.

Among the main movers, GAP rose 17.4% before the bell as the apparel retailer reported better-than-expected third-quarter earnings due to easing supply expenses and cost control measures.

ChargePoint Holdings stock fell 24.0% as the electric vehicle charging network provider cut its third-quarter revenue estimates in its preliminary results and named Rick Wilmer as CEO, effective immediately.

(Reporting by Shristi Ashar A in Bengaluru; Editing by Maju Samuel)

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