Stock Market Today: Stocks nudge higher as Treasury yields, dollar ease

Wall Street is looking to snap a three-day losing streak Wednesday as Treasury bond yields ease from recent multimonth highs.

Apr 17, 2024 - 18:30

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Stock Market Today: Stocks nudge higher as Treasury yields, dollar ease

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U.S. equity futures bumped higher Wednesday, while Treasury yields and the dollar held steady, as investors looked to snap a three-day losing streak on Wall Street while closely eyeing Israel's expected response to Iran's weekend missile strike.

Tensions in the region, which accelerated sharply following Iran's unprecedented attack on Israeli soil late Saturday, have yet to fully work their way into global markets, with oil prices falling for the past three sessions and stocks largely tracking both Federal Reserve interest rate forecasts and the start to the first quarter earnings season.

Fed Chairman Jerome Powell's remarks to an economic forum in Washington yesterday triggered a larger reaction in both the bond and currency markets as he suggested that recent inflation data "indicate that it's likely to take longer than expected" before the central bank can confidently begin easing rates.

qFed Chairman Jerome Powell told an event in Washington Tuesday that "If higher inflation does persist, we can maintain the current level of restriction for as long as needed."
Tom Williams/Getty Images

"Right now, given the strength of the labor market and progress on inflation so far, it's appropriate to allow restrictive policy further time to work and let the data and the evolving outlook guide us," Powell said.

"If higher inflation does persist, we can maintain the current level of restriction for as long as needed," he added.

Rate traders have pared bets on Fed rate cuts in both June and July, and now suggest the first of likely two reductions this year will take place only in September.

That's added upward pressure to Treasury bond yields, taking benchmark 10-year notes closer to the 4.7% mark — a level seen only twice since the global financial crisis — and nudged 2-year notes past the 5% mark in late Tuesday trading.

Benchmark 10-year notes were marked modestly lower at 4.639% in overnight dealing, with 2-year notes at 4.956% heading into the start of the New York trading session.

The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.11% lower at 106.135.

Oil prices were also in the red, with Brent crude contracts for June delivery down 74 cents to $89.26 per barrel as traders unwind bets on supply disruptions tied to the prospect of a broader military conflict and eyed Energy Department data on domestic stockpiles and overall exports due out later in the session.

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On Wall Street, stocks are set for modest early gains, with the S&P 500 priced for a 16 point opening bell advance and the Dow Jones Industrial Average indicated a 100 point bump. The Nasdaq is called 45 points higher.

In overseas markets, Europe's Stoxx 600 was marked 0.65% higher in early Frankfurt trading, with Britain's FTSE 100 up 0.56% in London.

Overnight in Asia, Japan's Nikkei 225 ended 1.32% lower in Tokyo, dipping below the 38,000 mark for the first time since February, while the regionwide MSCI ex-Japan benchmark rose 0.3% into the close of trading.

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