Futures tepid after S&P 500 ends at record level

(Reuters) – U.S. stock index futures were subdued on Friday as a rise in bond yields weighed on richly valued technology stocks a day after the S&P 500 closed at a record high.

FILE PHOTO: American flags hang from the facade of the New York Stock Exchange (NYSE) building after the start of Thursday’s trading session in Manhattan in New York City, New York, U.S., January 28, 2021. REUTERS/Mike Segar/File Photo

High-flying Amazon.com Inc, Apple Inc. Microsoft Corp and Facebook Inc were down between 0.2% and 0.5% in premarket trading as yields on the benchmark 10-year Treasury ticked higher to 1.67%.

A recent pullback in the yield has pushed the Nasdaq to seven-week highs and within 2% of its February record level.

Weaker-than-expected labor market data on Thursday eased inflation worries and validated the U.S. Federal Reserve’s accommodative stance, lifting the tech-heavy Nasdaq 1% higher and powering the S&P 500 to a record close.

Bank of America’s weekly fund flow figures showed investors have pumped more money into equities over the past five months than in the last 12 years, as ultra-easy monetary policies and unprecedented stimulus have sparked a secular shift into stocks.

On the economic front, data on U.S. producer prices, an inflation indicator, is on tap at 8:30 a.m. ET (1230 GMT).

President Joe Biden will release his first budget proposal to Congress on Friday, offering a long-awaited glimpse into a policy agenda that will mark a sharp departure from his predecessor, Donald Trump.

At 6:47 a.m. ET, Dow E-minis were up 66 points, or 0.2%, &P 500 E-minis were up 4.5 points, or 0.11% and Nasdaq 100 E-minis were down 9.75 points, or 0.07%.

Trading volumes have dwindled heading into the start of the earnings season next week. Analysts expect S&P 500 profits to jump about 25% year on year, the strongest first-quarter performance since 2018, according to Refinitiv IBES data.

Big U.S. lenders including Bank of America Corp, Citigroup Inc, JPMorgan Chase & Co, Goldman Sachs, Wells Fargo & Co and Morgan Stanley were up between 0.4% and 0.8% in early trading.

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