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U.S. Futures Mixed; February CPI Data Eyed

Stock Markets1 hour ago (Mar 10, 2021 07:02AM ET)

By Peter Nurse – U.S. stocks are seen opening mixed Wednesday, with tech stocks struggling to hold on Tuesday’s strong gains ahead of key inflation data.

At 7:05 AM ET (1205 GMT), the Dow Futures contract was up 70 points, or 0.2%, S&P 500 Futures traded 2 points, or 0.1%, lower, and Nasdaq 100 Futures dropped 35 points, or 0.3%.

The Nasdaq Composite closed sharply higher Tuesday, up 3.7%, with large tech stocks back in favor following a correction of over 10% in the last three weeks in the wake of a jump in Treasury yields. The Dow Jones Industrial Average ended only 0.1% higher, while the S&P 500 rose 1.4%.

However, investors remain on edge amid uncertainty over whether this reprieve in growth stocks has staying power, or is merely a relief rally that will soon peter out.

Key to which direction these stocks move is likely to be fluctuations in U.S. Treasury yields. The benchmark 10-year yield traded around 1.56%, below Friday’s 1.62% peak, after Tuesday’s auction of $58 billion in U.S. 3-year notes was well received.

There are further government debt auctions this week, including a mammoth $38 billion sale of 10-year notes at 1 PM ET. In addition, Wednesday will see the release of consumer price data for February, at 08:35 AM ET (1330 GMT), which is expected to show a slight acceleration in the overall inflation.

Some investors see a real risk of an overheated U.S. economy and higher inflation, particularly on the back of the Biden’s administration proposed $1.9 trillion stimulus plan, which could be passed by the House of Representatives later Wednesday.

In the corporate sector, attention is likely to be on Tesla (NASDAQ:TSLA) after the electric car manufacturer jumped 20% on Tuesday, while GameStop (NYSE:GME) continues to be in demand as activist investor Ryan Cohen shakes up its online operations.

Also in the spotlight will be General Electric (NYSE:GE) after the conglomerate announced a deal to combine its jet-leasing business with rival AerCap in a deal valued at $30 billion.

Oil prices edged higher Wednesday, ahead of the release of official crude inventories from the Energy Information Administration later in the session.

U.S. oil stocks rose by 12.8 million barrels in the week to March 5, according to data from the American Petroleum Institute, released Tuesday.

U.S. crude futures traded 0.4% higher at $64.28 a barrel, while the international benchmark Brent contract rose 0.2% to $67.78.

Elsewhere, gold futures fell 0.5% to $1,709.30/oz, while EUR/USD traded 0.1% lower at 1.1888.

U.S. Futures Mixed; February CPI Data Eyed

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