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U.S. equity futures bounced higher Tuesday, while Treasury yields steadied and the dollar snapped a five-day winning streak, as investors looked to a series of economic data releases that could define the bond market’s recent slump.
The S&P 500 edged into a modest closing bell gain on Monday, with the benchmark adding around 9 points on the session to end the day just 50 points or so ahead of its Election Day level. The broader session moves, however, were tied to a pullback in market volatility that was linked, in part, to an easing in Treasury yields.
Bond markets are likely to be in focus once again Tuesday as the Commerce Department reports producer price inflation data for the month of December at 8:30 am Eastern time and traders brace for a key reading of consumer price inflation on Wednesday.
Benchmark 10-year Treasury note yields were last marked at 4.782% heading into the start of the New York trading session, with 2-year notes changing hands at 4.386%.
Reports suggest President-elect Donald Trump is mulling a plan to phase-in tariffs on imported goods when he takes office next week.
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The U.S. dollar index, which tracks the greenback against a basket of six global currency peers, was marked 0.35% lower at 109.537 amid reports that suggest President-elect Donald Trump is planning to phase-in tariffs over several months, potentially muting their inflation impact.
The report from Bloomberg News added a much-needed sentiment boost to beaten-down stocks and looks to provide at least an earlier level of support at that start of trading.
Futures contract tied to the S&P 500 suggest an opening bell gain of around 30 points, with the Dow Jones Industrial Average called 140 points higher and the Nasdaq set for a 150 point advance.
Related: Wall Street debates bond market rout as inflation data looms
Global oil prices were also in focus, following the highest closing level for WTI crude in more than four months, as traders continue to study the impact of new U.S. sanctions on the sale of Russian petroleum products.
Brent crude contracts for March delivery, the global pricing benchmark, were last seen 36 cents lower on the session at $80.66 per barrel, with WTI futures for February slipping 26 cents to $78.54 per barrel.
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In overseas markets, reports of phase-in tariffs lifted Europe’s Stoxx 600 for the first day in three, with the benchmark rising in mid-day Frankfurt trading. Britain’s FTSE 100, meanwhile, edged 0.14% higher in London.
Overnight in Asia, Japan’s Nikkei 225 closed 1.83% lower as tech stocks declined following the unveiling of new U.S. export rules on AI technologies. The regional MSCI ex-Japan benchmark, meanwhile, was last marked 0.47% lower into the final hours of trading.
Related: Veteran fund manager issues dire S&P 500 warning for 2025
