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U.S. equity futures moved higher in early Thursday trading, matching gains for both the dollar and Treasury bond yields, as investors looked to a key set of data releases and a key overseas interest rate decision prior to the start of trading.
Stocks ended higher on Wednesday, powered in part by big gains in bank and transport stocks and a pullback in Treasury yields, although gains remained capped by political uncertainty tied to a deadlocked U.S. Presidential election.
Bond markets are likely to be back in focus again today, as well, with investors looking to navigate a key reading of September retail sales at 8:30 am Eastern time as well as the Labor Department’s weekly tally of new jobless claims.
Rate traders will be focused on September retail sales and jobless claims data, as well as the broader bond market, in the early Thursday session.
Treasury yields have been moving higher for much of the past two weeks, with some traders citing the impact of policies from both candidates that will both add to the country’s record debt and deficits and, in the case of former President Donald Trump, stoke renewed inflation concerns.
Benchmark 10-year Treasury note yield were last marked 3 basis points higher in overnight trading at 4.042% while rate-sensitive 2-year note yields were trading at 3.953%.
Related: Bond markets are heaving as Fed interest rate bets swing
The U.S. dollar index was also moving higher against its global peers, while the euro traded at an eleven week low against the greenback, ahead of today’s interest rate decision from the European Central Bank in Frankfurt.
Traders expect the ECB to execute its first back-to-back rate cut in more than a decade as it lowers its benchmark deposit rate by 25 basis point to 3.25% amid slowing growth and fading inflation pressures.
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On Wall Street, stocks are looking at solid early gains, with the S&P 500 called 24 points higher and the Dow Jones Industrial Average priced for a
The tech-focused Nasdaq, meanwhile, is called 144 points higher, with chip stocks leading the early gains, following a blowout set of third quarter earnings from Taiwan Semiconductor.
The world’s largest contract chipmaker posted record profits of T$325.3 billion and forecast a 30% growth rate for 2024 revenues, much of it tied to the “very real” demand for AI technologies.
Netflix (NFLX) shares are also in focus as the online streaming giant gets set to post its third quarter earnings update after the closing bell.
Related: Analysts revisit Netflix stock price targets as Q3 earnings loom
In overseas markets, European stocks were higher heading into the ECB rate decision, with the Stoxx 600 rising 0.49% and Britain’s FTSE 100 gaining 0.34% in London.
Overnight in Asia, another disappointing government briefing on stimulus plans sent China shares tumbling, with the CSI falling 1.1% and stocks in Shenzen down 0.73%.
Japan’s Nikkei 225, meanwhile, ended the session 0.69% lower as chip stocks slumped prior to the TSMC earnings report.
Related: Veteran fund manager sees world of pain coming for stocks
