Stocks Retreat Amid Rising Treasury Yields

Treasury Yields Hit New Highs

Yesterday, Fed Chair Jerome Powell reiterated his dovish position and stated that interest rates would stay low in order to support the economy. Meanwhile, bond market traders focused on the threat of higher inflation and sold U.S. government bonds, pushing Treasury yields to new multi-month highs.

Currently, the yield of 10-year Treasuries is trying to settle above 1.45%, while the yield of 30-year Treasuries is testing the 2.30% level.

Rising yields have once again put pressure on tech stocks, and Nasdaq futures are down by about 0.7% in premarket trading. S&P 500 futures are also under pressure in premarket trading and are down by 0.3%.

Initial Jobless Claims Declined To 730,000

The U.S. has just provided Initial Jobless Claims and Continuing Jobless Claims reports. Initial Jobless Claims report indicated that 730,000 Americans filed for unemployment benefits in a week compared to analyst estimate of 838,000.

Meanwhile, Continuing Jobless Claims declined from 4.52 million (revised from 4.49 million) to 4.42 million compared to analyst consensus of 4.47 million.

The better-than-expected Initial Jobless Claims report has already managed to provide some support to S&P 500 futures, but it remains to be seen whether this support will be sufficient enough to push stocks back into the positive territory.

Durable Goods Orders Increased By 3.4% In January

The U.S. has also released Durable Goods Orders report for January which indicated that Durable Goods Orders grew by 3.4% month-over-month in January. Analysts expected that Durable Goods Orders would grow by 1.1%.

The second estimate of the fourth-quarter GDP Growth Rate report showed that GDP grew by 4.1% quarter-over-quarter compared to analyst consensus which called for growth of 4.2%. Slower growth may put some pressure on the market, but traders may choose to focus on the better-than-expected job market data.

Later, traders will have a chance to take a look at Pending Home Sales report for January. Analysts expect that Pending Home Sales remained unchanged on a month-over-month basis after declining by 0.3% in December.

For a look at all of today’s economic events, check out our economic calendar.