US pre-open: Futures mixed following yesterday's bond-fuelled rout

Wall Street futures were mixed ahead of the bell on Friday after the Nasdaq Composite recorded its worst session since October amid rising bond yields.

As of 1230 GMT, Dow Jones futures were down 0.21%, while S&P 500 and Nasdaq-100 futures were 0.05% and 0.11% weaker, respectively.

The Dow Jones closed 559.85 points lower on Thursday after rising interest saw indices retreat.

A sudden and pronounced rise in bond yields was in focus again on Friday, with the rate on the US 10-year Treasury note briefly rising as high as 1.6% yesterday before dropping back down to around 1.52% - its highest level since last February.

Tech stocks like Alphabet, Facebook and Tesla, which began 2021 on sturdy ground, all dropped more than 3% on Thursday as a result of the bond rout, while tech giant Apple has now seen its shares fall more than 15% throughout the course of the month.

Markets.com's Neil Wilson said: "Markets are now starting to price for rate hikes far sooner than the Fed is indicating it will act. It’s not that rates are particularly high, it’s more the pace of the move taking frothy equity markets off guard.

"Valuations are stretched, so richly valued stocks are easily moved by these kinds of gyrations in the bond market. Whilst investors had been reasonably comfortable with a rising tide for rates, this sudden lurch higher requires repricing."

Also drawing an amount of investor attention was news that Democrats had suffered a setback overnight in their plans to move ahead with President Joe Biden's $1.9trn stimulus package after Senate parliamentarian Elizabeth MacDonough said lawmakers could not include a $15.0 per hour minimum wage hike in the bill.

On the macro front, January's PCE price index will be released at 1330 GMT, as will wholesale inventories data, while February's Chicago PMI and the University of Michigan's consumer sentiment index will follow at 1445 GMT and 1500 GMT, respectively.

In the corporate space, Foot Locker posted a decline in fourth-quarter net income to $123.0m and a 2.7% drop in same-store sales, while AMC Networks and Draftkings were both slated to update the market with their latest quarterly earnings before the open.