Wall Street set to open lower as bond yields rise, Cisco weighs

EngageNewswire.com is a high ranking blog, press release and news publishing website. We publish content from trusted sources.

(Reuters) – Wall Street was on pace to open lower on Thursday, weighed down by U.S. Treasury yields hitting fresh seven-year highs and Cisco’s disappointing forecast, while looming Sino-U.S. trade talks added to the jitters.

FILE PHOTO: Traders and guests gather for the IPO of PermRock Royalty Trust on the floor of the New York Stock Exchange (NYSE) in New York, U.S., May 2, 2018. REUTERS/Brendan McDermid

Ten-year U.S. government Treasury yield US10YT=RR, a key driver of global borrowing costs, hit a high of 3.1 percent as more expensive oil pointed to faster inflation and followed some upbeat U.S. retail sales numbers.

Oil prices hit $80 per barrel for the first time since November 2014 on concerns that Iranian exports could fall due to renewed U.S. sanctions and reduce supply in an already tightening market.

“There’s a lot of chatter that the 10-year is somehow going to explode to the upside, that’s why its getting everybody’s attention,” Kim Forrest, senior portfolio manager at Fort Pitt Capital Group in Pittsburgh.

“There is a lot of worry out there that might be reflected in the market … and trade is the icing on the cake.”

The United States and China will resume negotiations over the next two days to resolve their differences over trade, and officials from both sides have recently signaled that they are looking for a deal.

Japan is considering tariffs on U.S. exports worth $409 million in retaliation against U.S.-imposed steel and aluminum import tariffs, according to media reports.

Shares of Cisco (CSCO.O), a component of all three major U.S. indexes, fell 3.9 percent in premarket trading after the company’s disappointing forecast indicated its transition to a software-focused business was a work in progress.

At 8:46 a.m. ET, Dow e-minis 1YMc1 were down 37 points, or 0.15 percent. S&P 500 e-minis ESc1 were down 5.75 points, or 0.21 percent and Nasdaq 100 e-minis NQc1 were down 36.75 points, or 0.53 percent.

Walmart (WMT.N) rose 1.7 percent after the retailer posted a rebound in its U.S. e-commerce business and beat profit and revenue expectations.

However, J.C. Penney Co tumbled 10.4 percent after its same-store sales missed estimates and the company warned its could post a loss this year.

J.C. Penney’s results come a day after fellow department store operator Macy’s (M.N) strong report helped drive the small-cap Russell 2000 index to a record high.

Coca-Cola (KO.N) rose 0.8 percent after Barclays upgraded the stock to “overweight.”

NetEase (NTES.O) dropped 8.8 percent after the Chinese internet company’s first-quarter profit missed Wall Street estimates.

On the economic front, data showed new applications for U.S. jobless benefits increased more than expected last week, but the number of Americans on unemployment rolls fell to the lowest since 1973, pointing to diminishing labor market slack.

Reporting by Medha Singh in Bengaluru; Editing by Anil D’Silva

EngageNewswire.com EngageNewswire.com is a high ranking blog, press release and news publishing website. We publish content from trusted sources.

Related Posts