US pre-open: Stocks mixed as bond yield and stimulus talks remain in focus

Wall Street futures were mixed ahead of the bell on Wednesday as market participants remained focussed on bond yields and stimulus talks.

As of 1240 GMT, Dow Jones futures were up 0.23%, while S&P 500 and Nasdaq-100 futures were 0.04% and 0.28% weaker, respectively.

The Dow Jones closed 30.30 points higher on Tuesday, while the tech-heavy Nasdaq surged more than 460 points.

Traders were keeping a keen eye on the yield on the 10-Year Treasury note before the bell, trading slightly below recent highs at 1.56% ahead of today's auction of $38.0bn in notes at 1800 GMT, with investors looking out for clues into the next direction for rates.

Also in focus, House Democrats looked set to pass Joe Biden's $1.9trn stimulus bill Wednesday morning, with Biden expected to sign the bill over the weekend and checks of up to $1,400 per eligible American on track to start going out before the end of the month.

CMC Markets' Michael Hewson said: "US markets look set for a mixed open after the Nasdaq posted its best one-day gain in 4 months in the wake of a decline in US 10-year yields. If this is the shape of things to come with respect to the relationship between long term US yields and the Nasdaq then the next few days and weeks could well be a very bumpy ride.

"While the Nasdaq saw gains of over 3.5% yesterday it was very notable that the Dow only rose 0.1%. That divergence speaks volumes about how one particular sector is driving US markets, and as such speaks to how precarious current sentiment is."

On the macro front, applications to refinance a home loan fell 5% week-on-week, according to the Mortgage Bankers Association, the first year-on-year drop since March 2019, as the average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances increased to 3.26% from 3.23%.

Still to come, core inflation data for the twelve months ended 28 February will be released at 1330 GMT, while last month's US Government monthly budget statement was slated for release at 1900 GMT.

In corporate news, Bumble and AMC Entertainment were both scheduled to report earnings on Wednesday.