Stock Futures Unravel as Rising Bond/Bund Yields Spook Investors

Triggered by a breach of pivotal technical support in Germany's DAX amid elevated bund yields, and weighed down by the hawkish bias of the Federal Open Market Committee statement, US stock futures are trading defensively ahead of Thursday's regular open.

After taking a breather Wednesday, sellers are back in control on Wall Street as investors shift their focus back to rising bond yields -- the 10-year note is now in the "red zone" of 2.75% -- and quarterly results. Shares of component stocks DowDupont ( DWDP ) and Microsoft ( MSFT ) are both losing ground after reporting results before the open. DowDupont beat expectations but the stock is underwater by almost 1% in premarket.

Microsoft reported better-than expected profit and sales, but posted a loss when including tax-related charges, driving the stock down by more than 1%.

Facebook ( FB ) shares are in the green as upbeat Q4 results overshadowed the first drop in daily usage, while shares of EBay ( EBAY ) are soaring to a record high on upbeat FY18 guidance.

On the economic front, initial jobless claims for the week ended Jan. 27 were down by just 1,000 to 230,000, beating expectations for a slight gain to 235,000.

Fourth-quarter productivity was down 0.1%, significantly below forecasts for a 1.1% gain, and follows a downward revised 2.7% increase in Q3. Lower production translated into a 2.0% gain in unit labor costs, more than twice the increase the street anticipated.

Coming up later this morning is manufacturing data from US purchasing managers and the Institute for Supply Management, as well as December construction spending.

-Dow Jones Industrial down 0.69%

-S&P 500 futures down 0.41%

-Nasdaq 100 futures down 0.82%


Nikkei up 1.68%

Hang Seng down 0.75%

Shanghai Composite down 0.97%

FTSE-100 down 0.56%

DAX-30 down 1.3%


(+/-) Large cap tech: Mixed

(-) Chip stocks: Lower

(-) Software stocks: Lower

(+/-) Hardware stocks: Mixed

(+/-) Internet stocks: Mixed

(+) Oil stocks: Higher

(+) Biotech stocks: Higher

(+) Drug stocks: Higher

(+) Financial stocks: Higher

(-) Retail stocks: Lower

(+/-) Industrial stocks: Flat

(+/-) Airlines: Mixed

(-) Autos: Lower


(+) LTBR (+18.57%) Awarded patents in China and Europe for metallic fuel design

(+) EBAY (+10.89%) Beat Q4 expectations, issued upbeat guidance, announced deal with Dutch payment company Adyen

(+) NBEV (+8.66%) Expands portfolio with Loblaws and Sobeys, largest grocery chains in Canada


(-) OMI (-12.16%) Lowered FY17 adjusted EPS outlook

(-) PYPL (-6.24%) Issued weak Q1 EPS guidance

(-) NVO (-5.96%) Reported weaker-than-expected Q4 results

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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