US pre-open: Futures mixed as bond yields remain elevated

Wall Street futures had stocks opening higher ahead of the bell on Monday as both the Dow Jones and S&P 500 looked set to build upon their recent record highs.

As of 1220 GMT, Dow Jones and S&P 500 futures were 0.30% and 0.07% higher, respectively, while Nasdaq-100 futures were down 0.02%.

The Dow Jones closed 293.05 points higher on Friday, while the Nasdaq Composite saw out the session in the red as rising interest rates weighed on tech stocks.

The US 10-year Treasury hit its highest level since February 2020 on Friday, reaching 1.642%.

While yields remained elevated, they were off those highs prior to the open on Monday, down at around 1.61% and boosting sentiment as a result.

Market participants were also looking forward to a decision on interest rates from the Federal Reserve on Wednesday, with the bond market likely to take cues from the central bank in the week to come.

Also boosting sentiment early on Monday was news that the Internal Revenue Service had begun processing $1,400 direct payments to Americans over the weekend.

IG's Joshua Mahony said: "Despite Friday's push higher for US Treasury yields, the consolidation we are seeing this morning provides a more stable environment for both value and growth to thrive.

"With the Nasdaq having suffered steep losses on Friday, futures point towards a positive start to the week for the recently hard-hit tech sector. The past week has shown how the rotation between value and growth is likely to be a volatile one, and while we are looking at a likely rebound in tech today, there is also a significant chance of another sharp move lower before long."

On the macro front, March's New York Empire State manufacturing index will be released at 1230 GMT.

No major corporate earnings were slated for release on Monday but stocks most likely to benefit from a swift economic recovery from the Covid-19 pandemic leading gains, with American Airlines and United Airlines both up more than 2% and the likes of Boeing, Gap and multiple energy stocks also trading higher.