According to the report by CNBC, “U.S. stock index futures dipped in early morning trading on Wednesday after the Dow closed at a record high. Futures contracts tied to the Dow Jones Industrial Average shed 25 points. S&P futures and Nasdaq 100 futures also traded mildly lower”.
This move resulted after the closure of Dow Jones at a record high during the regular trading period on Tuesday, the 30-stock average’s eight records this year. The index further hit an all-time intraday high, due to sharing of Salesforce. As for S&P500, we find a fall of 0.06% during the volatile session of trading. Nasdaq Composite dipped 0.34%. further, Apple had the most negative impact on the index, sliding 1.6%.
In the meanwhile, the 10-year Treasury yield topped 1.30% on Tuesday, a level was previously seen in February 2020.even the 30-year rate hit its highest level in a year. It could be believed that higher rates could prompt investors to rotate out of equities and into bonds, emphasizing pressure on markets such as the tech market.
Contrarily, LPL Financial’s Jeff Buchbinder, believe these fears might be overblown.
“Our preference for stocks over bonds — supported by low-interest rates — is one of our highest conviction recommendations for 2021,” the equity strategist said. “Several segments of the equity market — particularly the energy sector and banks — offer higher yields than traditional high-quality bonds and offer attractive capital appreciation potential as interest rates rise,” he added.
Investors will have a feel for the ongoing economic recovery when the January retails sales are released at 8:30 a.m. ET Wednesday. Economists at Dow Jones are expecting sales to be up 1.2% for the month, following an unexpected decline of 0.7% in December.
CNBC also reports that bitcoin briefly topped $50,000 for the first time on Tuesday, as its surge to new record highs continued.