US pre-open: Stocks firmly in the green as bond yields slip

Wall Street stocks were firmly in the green ahead of the bell on Tuesday following a mixed session for major indices a day earlier.

As of 1240 GMT, Dow Jones futures were up 0.48%, while S&P 500 and Nasdaq-100 futures had the indices opening 1.01% and 2.23% firmer, respectively.

The Dow Jones closed 306.14 points higher on Monday, while the tech-heavy Nasdaq saw out the session 310.99 points weaker on the back of an ongoing rotation out of the sector amid elevated bond yields.

Tech shares look set to bounce back from heavy losses recorded over the last few sessions, with the yield on the 10-year Treasury not falling more than six basis points ahead of the bell to 1.52% after trading as high as 1.62% on Monday.

IG's Chris Beauchamp said: "Nasdaq futures have roared ahead in an early bid to make up some lost ground after their hefty pullback since the middle of February. The firesale in many big tech names has been driven by fears of how higher yields will damage the attractiveness of these high flyers, and the improved prospects for stocks that will benefit from reopening economies, but with many now much cheaper (compared to where they were) some will be eyeing up the sector, even if only for a quick rebound.

"The situation in the Nasdaq looks similar to late October, the last major pullback in the index, and with the mood-music around big tech turning distinctly sour the conditions are there for just the kind of rebound that will catch many by surprise."

News that the US Senate had passed a $1.9trn economic relief and stimulus package, set to include another round of stimulus checks to everyday Americans, will likely continue to give a boost to stocks reliant on an economic reopening - with banks, airlines, cruise lines and retailers all rising on Monday amid expectations for President Joe Biden to sign the bill into law by 14 March.

On the macro front, the National Federation of Independent Business' small business optimism index rose by 0.8 points in February to 95.8 but remained below the 98 average and pre-pandemic levels.

Still to come, Federal Reserve Bank of Dallas head Robert Kaplan will deliver comments at 2305 GMT.