Nasdaq, S&P, and Dow futures push higher and the yield curve inverts further

MBPROJEKT_Maciej_Bledowski

Stock market futures ticked slightly higher again on Thursday morning. In early market trading the Nasdaq 100 futures (NDX:IND) have jumped 0.2%, while the S&P 500 futures (SPX) gained 0.1%, and the Dow futures (INDU) have risen 0.1%.

The 2-10 yield spread has now inverted to -0.37 basis points, marking the deepest inversion since 2000. The U.S. 10-year Treasury yield (US10Y) is down three basis point to 2.71%, while the U.S. 2-year Treasury yield (US2Y) is down one basis point to 3.09%.

Jeffrey Gundlach, CEO of DoubleLine Capital LP stated: “The 2-year 10-year yield curve inversion is gaining steam. At 36 basis points right now. Rough road ahead.”

The Bank of England raised key rates by 50 basis points to 1.75%, marking the central banks most significant increase since 1995, as it warns of a long recession.

From an economic calendar vantagepoint, markets prepare to process advanced international trade goods data along with initial jobless claims figures both before the opening bell.

BTIG outlined in a investor note that: “Markets have slowed to a crawl again with VIX breaking under 22, and SPX nearing June’s high of 4177.”

“At this point it’s hard to see it not testing that this week, although there remains a decent amount of resistance in the 4175-4200 range. Above that 4231 becomes key (50% retracement of entire decline). As a reminder, once a bear market has reclaimed the 50% level, it has never gone on to break to new lows for that cycle.”

Among active stocks, shares of Alibaba Group Holding Limited (BABA) have moved higher after the Chinese tech company delivered a strong earnings report that beat on FQ1 Non-GAAP EPADS and revenue.