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U.S. equity futures steadied in early Wednesday trading while Treasury yields and the dollar slipped as investors continue to focus on this week’s December inflation report and big-bank earnings to define the market’s early 2024 direction.
Stocks ended mixed Tuesday, with another solid session for the so-called Magnificent 7 tech stocks driving the Nasdaq to a modest 0.1% gain while the S&P 500 slipped 0.15%. Markets ignored a pullback in Treasury yields and a bullish end-of-year survey from the National Federation of Independent Business.
A solid auction of $52 billion in new 3-year Treasury notes drew a big increase in overall bidders as well as foreign buyers. The sale helped the overall market hold recent gains heading into today’s $37 billion 10-year sale.
Benchmark 10-year notes were last seen trading at 3.984% heading into the start of the New York session, while 2-year notes slipped to 3.434%.
The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.14% lower at 102.245.
Bitcoin prices were also active and remain so into the Wednesday session, following the hacking of a Securities and Exchange Commission social-media account that displayed false information regarding the approval of an ETF related to the world’s biggest cryptocurrency.
Bitcoin was last marked 1% lower at $45,672.30, having risen past $47,000 following the unauthorized message on the X social-media website.
The SEC is expected to make a decision later today on the first of dozens of applications linked to ETFs that would hold bitcoin directly.
Markets remain focused on Thursday’s December CPI report, however, with analysts looking for headline price pressure to tick modestly higher, to 3.2% on the year and 0.2% on the month. The focus highlights the Federal Reserve’s last-mile challenge to return inflation to its 2% target.
The VIX index, the market’s key volatility benchmark, was marked 2.5% lower at $12.75 in the overnight session. That level suggests traders expect daily price moves on the S&P 500 of around 0.79%, or 37.6 points, over the next 30 days.
Heading into the start of trading on Wall Street, futures tied to the S&P 500 are set for a 2-point opening-bell gain while those linked to the Dow Jones Industrial Average are indicating a 30-point dip.
In overseas markets, Europe’s Stoxx 600 was marked 0.04% higher in early Frankfurt trading, while Britain’s FTSE 100 slipped 0.24% in London.
Overnight in Asia, Japan’s Nikkei 225 hit a fresh 34-year high of 34,441.72 points after rising 2.01% on the session as the yen weakened against the U.S. dollar and tech stocks followed last night’s higher close on Wall Street.
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