US pre-open: Subdued start as bond yields continue to climb

Meanwhile, a barrage of economic data was expected, including weekly jobless claims, pending home sales and GDP figures – not to mention speeches from a bunch of Federal Reserve members, including chair Jerome Powell.

Futures on the Dow Jones Industrial Average and S&P 500 were down 0.1% ahead of the opening bell, while the Nasdaq fell 0.2%.

The yield on a 10-year US Treasury was up a further 2.9 basis points at 4.645% early on, reaching fresh 16-year highs, while Brent crude continued to teeter around the $95-a-barrel level, raising concerns about price pressures ahead of a key gauge of inflation due out on Friday.

Stephen Innes, managing partner at SPI Asset Management, said that with the forward earnings yield on the S&P 500 at around the 5.5% level, the 90 basis-point or so difference between that and 10-year yields is at its lowest since the early-2000s.

"The days of easy buy-and-hold markets based on the luscious 3-to-6 ppt spreads above Treasuries in the post-financial crisis era look gone, and a regime change for valuations is obviously well underway," he said.

The very real prospect of a government shutdown next week was also looming large, which may only exacerbate the economic crisis as the Fed sticks to its hawkish stance over monetary policy. If no funding bill is agreed on in the next couple of days, a shutdown could begin on Sunday.

In other news, United Auto Workers union members are going to expand their strikes as they continue to battle with Detroit carmakers General Motors, Ford and Stellantis. New strike targets are expected to be announced on Friday morning.

Micron Technology futures were sinking after guiding to a worse-than-expected loss in its first quarter, despite beating forecasts in the fourth.

Citigroup will be in focus on reports that it is looking to sell its China retail wealth unit to HSBC.