Dow futures hunch over 300 factors amid earnings, rising bond yields and geopolitical tensions

U.S. inventory futures on Tuesday have been pointing to a poor begin to a holiday-shortened buying and selling week as earnings from main retailers, rising bond yields and geopolitical tensions weigh on sentiment.

How are stock-index futures buying and selling

S&P 500 futures
ES00,
-1.02%
dipped 34 factors, or 0.8%, to 4053
Dow Jones Industrial Average futures
YM00,
-0.75%
fell 316 factors, or 0.9%, to 33550
Nasdaq-100 futures
NQ00,
-1.29%
misplaced 133 factors, or 1%, to 12256

The Dow
DJIA,
-0.84%
rose Friday, however logged a 3rd straight weekly decline, whereas the , the S&P 500
SPX,
-0.79%
noticed a 0.3% weekly fall, its second straight decline. The Nasdaq Composite
COMP,
-0.90%
rose 0.6% final week. U.S. markets have been closed Monday for the Presidents Day vacation.

What’s driving markets

U.S. traders returned from the three-day weekend in a downbeat temper.

Trader sentiment is cautious as they observe benchmark bond yields close to their highs of the 12 months on expectations current strong financial knowledge will encourage the Federal Reserve to maintain borrowing prices larger for longer.

Minutes of the Fed’s Jan. 31-Feb. 1 assembly shall be revealed on Wednesday.

Tensions over Russia’s invasion of Ukraine, as President Joe Biden visits Poland and a Chinese delegation goes to Moscow, are including to the anxiousness.

“So far, risky assets have digested the rates repricing well — while the broad ‘risk-on’ rally has slowed to a crawl, the higher terminal rates have not moved through assets like a wrecking ball as some had assumed,” mentioned Stephen Innes, managing accomplice at SPI Asset Management.

“But there remains a heightened degree of caution due to the steep rise in U.S. yields and rate volatility, an environment where the U.S. dollar tends to benefit,” Innes added.

Such warning was matched by Jonathan Krinsky, chief technical strategist at BTIG, who seen that the newest rally had however begun to fade.

“After a few weeks of chopping around, the SPX looks to have broken its short-term uptrend just as momentum has begun to roll over, similar to breaks we saw in April, August, and December of 2022,” Krinsky wrote in a word to purchasers.

Source: BTIG

“As a reminder, the back-half of February is often one of the weaker parts of the calendar. This has come on the heels of rates which have been moving higher for the last couple of weeks. A slow equity reaction to rates has not been atypical over the last 18-months, as each of the prior six tactical peaks all occurred one to four weeks after the low in rates,” he added.

U.S. financial updates set for launch on Tuesday embrace the S&P flash providers and manufacturing buying managers’ indices for February, due at 9:45 a.m. Eastern. Existing residence gross sales figures shall be revealed at 10 a.m.

Companies in focus

Walmart Inc.
WMT,
-0.86%
shares have been buying and selling decrease within the premarket after the retail big reported its fourth quarter earnings and supplied its ahead steerage. The firm beat estimates on earnings and gross sales, but additionally supplied steerage on the primary quarter and the complete fiscal 12 months 2024 that fell wanting expectation.
Home Depot Inc.
HD,
-4.68%
shares have been additionally buying and selling decrease after fourth quarter outcomes from the house enchancment chain. While posting a beat on earnings through the quarter, gross sales missed expectations and the corporate’s downbeat ahead steerage cited persevering with challenges with inflation, labor markets and provide chains.
Shares of Meta Platforms Inc.
META,
+2.50%
rose 2% after the father or mother firm of Facebook and Instagram mentioned it’s testing a paid subscription tier to confirm accounts.