U.S. stock futures were steady in overnight trading on Wednesday following a tech-driven sell-off on Wall Street.
Dow futures fell just 25 points. S&P 500 futures were flat and Nasdaq 100 futures rose 0.02%.
The major averages dipped on Wednesday after a hot inflation report pushed up bond yields. The rise in yields especially pressured growth pockets of the market.
The Dow Jones Industrial Average lost 240 points, dragged down by roughly 3% losses in Salesforce and Nike. The S&P 500 fell 0.8%. The Nasdaq Composite was the relative underperformer, dipping 1.7% as Facebook-parent Meta Platforms, Amazon, Apple, Netflix, Microsoft and Google-parent Alphabet all closed lower.
The small-cap benchmark Russell 2000 dropped 1.6% on Wednesday.
Persistent inflation data was released on Wednesday. The consumer price index, which is a basket of products ranging from gasoline and health care to groceries and rents, rose 6.2% in October from a year ago, hitting its highest level in three decades. On a monthly basis, the CPI increased 0.9% against the 0.6% estimate.
“Inflation remains stubbornly high, to the surprise of many that expected prices to come back to earth sooner,” said Ryan Detrick, chief market strategist for LPL Financial. “The truth is you can’t shut down a $20 trillion economy and not feel some bumps as it restarts, but we are hopeful the supply chain issues will resolve over the coming quarters and inflation should calm down as well.”
Following the CPI data, traders moved up their expectations for when the first Fed rate hike would occur. The Fed funds futures market now sees greater odds of the central bank’s first full rate hike coming in July 2022.
Investors also took refuge in inflation hedges on Wednesday, like gold and bitcoin.