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Stock market news live updates: Stock futures look to rebound after tech rout

Emily McCormick
·Reporter
·5 min read
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Stock futures pointed to a higher open Wednesday morning after a technology-led selloff a day earlier, with growth stocks giving back more of their 2020 gains after a key policymaker suggested interest rates might need to rise to prevent an economic overheating.  

Contracts on the Nasdaq gained 0.5%, after the index fell 1.9% during Tuesday's regular session for its worst day since March. Contracts on the S&P 500 and Dow also pointed toward a high open. 

The sharp move lower in growth stocks came after Treasury Secretary Janet Yellen suggested Tuesday that interest rates might need to rise to stave off an overheating in the economy, with economic activity picking back up much faster than expected as vaccinations take place and social distancing standards get eased. She added in later remarks, however, that a near-term interest rate hike was not something she was "predicting or recommending," as that decision lies with the Federal Reserve.

Still, some companies have also said that surging demand and supply chain shortages have pushed prices higher, hinting at signs of overheating that have worried some market participants. Mentions of inflation on first-quarter earnings calls have surged by 800% year-over-year, according to Bank of America strategist Savita Subramanian.

"I think to some extent the market is now taking a bit of a pause thinking that some of the best news may be behind us at this point on stocks, including the growth stocks, especially as we look to more reopenings," Rob Haworth, U.S. Bank Wealth Management senior investment strategist. "I think it's two-fold: One, a great earnings season that people wonder if it will be repeated, and two, looking more to that reopening story."

Plus, with stocks having reached record highs last week, equities were vulnerable to a pull-back at the slightest trigger, many strategists noted. And as first-quarter earnings season winds down, investors will be left to contemplate the future policy landscape, which may be somewhat less constructive for corporate profits. 

"I do think there's a potential for a short-term bounce in volatility due to those excessive valuations and all of the uncertainty that currently stands with respect to the infrastructure spending bill, ultimately how it’s going to be funded, and certain taxation policies," Kevin Mahn, chief investment officer at Hennion and Walsh Investment Management, told Yahoo Finance. 

"But, beyond the short-term bouts of volatility, there is continued reason for optimism, whether it’s consumer confidence, whether it’s the strength in earnings, recognizing that thus far we have an 86% beat rate for the companies that have reported," he added. "So there are reasons for optimism, but we would recommend that investors also consider adding diversification to their portfolios to help withstand those short-term bouts of volatility.”

—

9:04 a.m. ET: Facebook's oversight board upholds site's decision to suspend Trump's account, calls for review of Facebook's content policies

Facebook's Oversight Board announced on Wednesday it ruled to uphold the company's suspension of former President Donald Trump from Facebook and Instagram. The social networking company had suspended Trump's accounts indefinitely in January, after saying "the risks of allowing the president to continue to use our service during this period are simply too great" amid the Capitol riots earlier this year.

"Trump’s posts during the Capitol riot severely violated Facebook’s rules and encouraged and legitimized violence," the Oversight Board said in a statement on Twitter.

The board added, however, that it "a found Facebook violated its own rules by imposing a suspension that was ‘indefinite.’ This penalty is not described in Facebook’s content policies. It has no clear criteria and gives Facebook total discretion on when to impose or lift it." 

"Within 6 months of today, Facebook must review this matter and decide a new penalty that reflects its rules, the severity of the violation, and prospect of future harm," the board wrote. "Facebook can either impose a time-limited suspension or account deletion."

—

8:28 a.m. ET: Private payrolls rose by 742,000 in April, missing expectations: ADP

Private payrolls rose less than expectedin April, but still increased by the most since September as COVID-19 vaccinations and reopenings stoke economic activity.

U.S. employers added back 742,000 payrolls last month,ADP said in its closely watched monthly report on Wednesday. This followed a revised rise of 565,000 jobs in March. Consensus economists were looking for private payrolls to increase by 850,000, according to Bloomberg data.

As has been the case over the past few months, the service-providing sector saw most of the job gains, with these rising by 636,000. But the goods-producing sector also saw more job gains, with payrolls up by 106,000 for the month as rising demand for manufactured goods helped fuel employment increases.

—

7:20 a.m. ET Wednesday: Stock futures rise, with equities poised to rebound after Tuesday's tech selloff 

Here's where markets were trading ahead of the opening bell Wednesday morning: 

  • S&P 500 futures (ES=F): 4,170.5, up 12.25 points or 0.29%

  • Dow futures (YM=F): 34,083.00, up 63 points or 0.19%

  • Nasdaq futures (NQ=F): 13,601.50, up 65.50 points or 0.48%

  • Crude (CL=F): +$0.71 (+1.08%) to $66.40 a barrel

  • Gold (GC=F): +$0.40 (+0.02%) to $1,776.40 per ounce

  • 10-year Treasury (^TNX): +1.1 bps to yield 1.603%

—

6:13 p.m. ET: ET Tuesday: Stock futures edge lower 

Here's where markets were trading as the overnight session kicked off: 

  • S&P 500 futures (ES=F): 4,157.25, down 1 point or 0.02%

  • Dow futures (YM=F): 34,018.00, down 2 points or 0.01%

  • Nasdaq futures (NQ=F): 13,519.00, down 17 points or 0.13%

NEW YORK, NEW YORK - MARCH 10: A man walks in front Nasdaq building at Times Square on March 10, 2021, in New York. The Nasdaq Composite continued falling more than half a percent during the day. Also, the move away from Apple Inc, Amazon.com Inc , Facebook Inc, Tesla Inc and Microsoft Corp, falling during the day, helped small-cap stocks rise more than double the gains of the S&P 500. (Photo by John Smith/VIEWpress)
NEW YORK, NEW YORK - MARCH 10: A man walks in front Nasdaq building at Times Square on March 10, 2021, in New York. The Nasdaq Composite continued falling more than half a percent during the day. Also, the move away from Apple Inc, Amazon.com Inc , Facebook Inc, Tesla Inc and Microsoft Corp, falling during the day, helped small-cap stocks rise more than double the gains of the S&P 500. (Photo by John Smith/VIEWpress)

—

Emily McCormick is a reporter for Yahoo Finance. Follow her on Twitter: @emily_mcck

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(To watch Bartus’s track record, click here.) Wall Street’s views on Zoom offer a bit of a conundrum. The analyst consensus here is a Hold, based on reviews that include 6 to Buy, 10 to Hold, and 2 to Sell. On the other hand, the stock’s $444.40 average price target implies an upside of 41% on the one-year horizon. (See Zoom’s stock analysis at TipRanks.) Shopify, Inc. (SHOP) Last on our list of Wood’s picks, Shopify, is a Canada-based e-commerce giant that needs no introduction. Shopify has been around for 15 years, and was an early leader in providing e-commerce platforms to third parties. The company’s services include payment processing, marketing, shipping, and customer engagement. Shopify grossed $2.93 billion last year, and has seen sequential revenue gains in each of the last four quarters. While the stock has found 2021 more of a slog, it is still up by 77% over the past 12 months, handily beating the S&P 500’s 47% one-year gain. 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