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Tech Stocks Gain Ground Despite Rising Treasury Yields
S&P 500 futures are gaining ground in premarket trading as tech stocks look ready to continue the rebound that began during yesterday’s trading session.
Shares of Tesla are up by about 4% ahead of the market open while Apple and Microsoft shares are gaining about 0.5%. Yesterday’s trading action indicated that traders were ready to “buy the dip” in tech stocks and rushed to scoop up shares at lower levels despite worries about higher inflation.
Interestingly, U.S. Treasury yields continue to rally today. The yield of 10-year Treasuries is currently trying to settle above 1.39%, while the yield of 30-year Treasuries is testing multi-month highs at 2.26%. However, rising bond yields failed to put any material pressure on stocks ahead of the market open.
Fed Chair Powell Heads To Capitol Hill For Second Day Of Testimony
Today, Fed Chair Jerome Powell will provide his commentary to the Committee on Financial Services of the U.S. House of Representatives. Yesterday, Powell stated that the economy needed additional support and added that the Fed remained focused on reaching employment and inflation goals.
While Powell downplayed inflation risks, bond market traders are not that optimistic as Treasury yields continue to move higher. Today, Powell will likely offer a similar commentary so traders will be mostly focused on Treasury yields.
Germany’s Growth Boosts Global Markets
Germany has recently provided the final reading of GDP Growth Rate report for the fourth quarter of 2020. Germany’s GDP increased by 0.3% quarter-over-quarter compared to analyst consensus which called for growth of just 0.1%. On a year-over-year basis, GDP declined by 3.7%.
Germany’s economy managed to grow despite coronavirus-related problems thanks to strong exports. Germany’s export-oriented economy benefited from strong demand from China which continued to enjoy a healthy economic rebound.
Solid data from Germany provided additional support to global markets as it indicated that Eurozone’s biggest economy managed to adapt to the current environment and delivered growth despite problems on the coronavirus front.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire