S&P 500 Futures Waver As Investors Sell Tech Bonds and Stocks


U.S. equity futures wavered as investors sold government bonds and richly priced tech stocks that had risen in a low-yielding environment.

Futures contracts linked to the S&P 500 have fluctuated between gains and losses, indicating that the general market gauge may be volatile after the New York opening bell. Dow Jones Industrial Average futures edged up 0.2%. Futures on the Nasdaq-100 fell 0.4%, suggesting that tech stocks may prolong their decline.

In bond markets, the yield on the 10-year Treasury bill rose to 1.765% – near its highest level in more than 14 months – from 1.721% on Monday. Earlier this month, the yield closed at around 1.730%, its highest since January 2020. Yields rise when prices fall.

This year, investors have moved away from government bonds as the improving economic outlook and concerns about higher inflation have combined to undermine demand for what are considered the safest assets in the world. Some fund managers are betting the Federal Reserve will hike interest rates in 2023, despite the central bank’s commitment to keep monetary policy loose until the labor market recovers and inflation stays higher at 2% for a while.

“You will continue to see market tests that resolve themselves,” said Hugh Gimber, strategist at JP Morgan Asset Management. “This is basically a big economic experiment that we haven’t seen for many decades, which is why economic uncertainty is higher today.”

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