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* The rise in bank stocks slows down as bond yields decline
* Tech stocks are gaining ground after recent weakness
* GameStop builds on Monday’s 40% increase
* Futures up: Dow 0.35%, S&P 0.93%, Nasdaq 2.22% (Add comment, details; update prices)
March 9 (Reuters) – Major US stock indices were on their way to a higher opening on Tuesday, with the Nasdaq expected to rebound after a steep sell-off in the previous session, as US bond yields plummeted and investors scooped down beat technology stocks.
Tesla Inc was up about 6%, while Apple Inc, Amazon.com Inc, Facebook Inc and Microsoft Corp were each up about 2% in early trading.
Signs that a $ 1.9 trillion coronavirus aid package was on the verge of final approval led to a rise in revenues on Monday, putting tech-heavy Nasdaq more than 10% below its high on Feb. 12. which confirmed a correction.
Yields on US 10-year Treasuries fell to 1.54% after moving near the 13-month high of 1.613% in the previous session. Longer-term returns have risen over the past month as investors rate a faster-than-expected economic rebound and higher inflation rates.
Higher returns may weigh even more on technology and growth stocks with high valuations as they risk eroding the value of their cash flows over the longer term.
“Tech stocks are overdue for some sort of rebound after the downfall they’ve had so far, with most investors maintaining a positive medium to long-term outlook for tech stocks,” said Michael Sheldon, chief investment officer at RDM Financial in Westport, Connecticut. .
“Potential headwinds for the market are if interest rates continue to rise from this point in the short period … because they have risen too fast in too short a time.”
At 8:17 a.m.ET, Dow E-minis were up 110 points, or 0.35%, S&P 500 E-minis were up 35.75 points, or 0.93%, and Nasdaq 100 E-minis were up 273.5 points, or 2.22%.
The rise in revenues has accelerated a rotation from “stay-at-home” winners to stocks poised to profit from an economic reopening, pushing the blue-chip Dow to an intraday record Monday.
The global economic outlook has improved as the introduction of vaccines accelerates and the United States launches a massive new stimulus package, the Organization for Economic Co-operation and Development said, continuing the policy forum’s forecasts.
Major US lenders, including Bank of America Corp, Citigroup Inc, JPMorgan Chase & Co and Goldman Sachs, were down about 1% a day after the bank index jumped to a new 14-year high.
GameStop was up 11% to $ 215.95, building on Monday’s rise of more than 40% on the video retailer’s e-commerce strategy and speculation that small investors will be pouring incentive checks into the markets. (Reported by Shashank Nayar and Medha Singh in Bengaluru; edited by Maju Samuel)