Nasdaq-100 futures fell sharply on Friday, as U.S. bond yields resumed their push higher. That also triggered wobbles elsewhere among global markets, a day after a record-setting session on Wall Street.
Investors were facing a renewed pressure in the bond market. The yield on the U.S. 10-year Treasury climbed up to 1.60%, revisiting recent year-highs. In response, Nasdaq-100 futures slid nearly 2%, with S&P 500 futures down 0.6% and Dow futures down 0.1%. Shares of
fell nearly 4% in premarket and
dropped over 3%.
Bond yield fell below 1.5% for the first time in a week on Thursday, while the
Dow Jones Industrial Average
hit fresh records, as investors cheered a $1.9 trillion fiscal stimulus bill that President
signed into law. The
closed up 2.5%, putting it on pace for its strongest week since early February.
Some cited a crackdown on technology companies in China as adding to pressure on technology stocks. China’s market regulator said Friday it had imposed fines on twelve companies, including WeChat owner
ride-hailing giant Didi Chuxing and Japan’s SoftBank.
Asian stocks finished mostly higher, with a 1.7% gain for the
Nikkei 225 index.
But Hong Kong’s
Hang Seng Index
fell 2%, a standout decliner after a Covid-19 outbreak linked to a gym in a wealthy expat neighborhood sent hundreds to quarantine centers, Bloomberg reported.
“While trends in both Europe and the U.S. are still intact from a tech point of view, the performance of technology stocks is likely to be the determining factor in how the stock markets fare in the coming weeks., noted the Frankfurt-based
team in a note to clients.
“It is quite possible that the recent rise in interest rates will already be used again by short-term speculators to cause further unrest in the Nasdaq with further short sales”, said CMC analysts.
The Stoxx European 600 index fell 0.5%, after four straight days of gains. The region’s stocks got a boost on Thursday after the European Central Bank said it would speed up the pace of bond purchases to counter the effects of the pandemic.
Data for Friday includes producer prices where economists forecast a 0.4% monthly rise for February, compared with 1.3% the prior month. The University of Michigan’s preliminary March reading is expected to come in at 78, up from 76.8 last month.