U.S. equity futures moved lower in early Thursday trading, while Treasury bond yields remained elevated in the wake of the Federal Reserve’s cautious rate stance, as investors hit pause on the early Santa Claus rally.
Stocks are riding firm holiday gains so far this year, with the S&P 500 rising 1.1% over the shortened Christmas Eve session as outsized gains for megacap tech stocks, as well as run towards a $4 trillion valuation for Apple (AAPL) , offset another move higher in Treasury yields that could define markets over the coming year.
Benchmark 10-year notes were marked at 4.613% in overnight trading, a level that represents a gain of around 42 basis points over the month of December and is around 3.5 times the S&P 500 dividend yield of 1.32%.
Short-term yields have been rising, as well, with 2-year notes now pegged at 4.347%, up around 20 basis points from late-November levels as traders price in fewer Fed rate cuts in 2025 and recalibrate their growth and inflation forecasts for the world’s biggest economy.
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Wall Street, meanwhile, is looking to trim some of its early week gains heading into today’s session, although trading volumes are traditionally thin given both this year’s Christmas holidays and the eight-day Hanukkah observances, which began on Wednesday.Â
Futures contracts tied to the S&P 500 suggest a 32 point opening bell decline, with those linked to the Dow Jones Industrial Average indicating a 238 point pullback.
The tech-focused Nasdaq is called 133 points lower, with Tesla (TSLA) , Nvidia (NVDA)  and Palantir (PLTR)  active in early premarket trading.
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In Europe, several major markets remained closed for the region’s post-Christmas holidays, including Boxing Day in Great Britain, which limited action for the bluechip benchmarks.
The Stoxx 600 index was marked 0.32% higher in Frankfurt.
Overnight in Asia, Japan’s Nikkei 225 rose 1.12% in Tokyo following dovish comments on rate hikes yesterday from Bank of Japan Governor Kazuo Ueda. The regional MSCI ex-Japan benchmark, meanwhile, edged 0.08% lower into the close of trading.
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