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Nasdaq futures subdued as tech sell-off deepens

(Reuters) – Futures tracking the tech-heavy Nasdaq were muted on Wednesday after sliding for six straight sessions as investors swapped growth-oriented technology shares with stocks that stand to gain the most from an economic rebound.

FILE PHOTO: FILE PHOTO: A view of the exterior of the Nasdaq market site in the Manhattan borough of New York City, U.S., October 24, 2016. REUTERS/Shannon Stapleton

Shares of Microsoft Corp, Alphabet Inc, Amazon.com Inc and Apple Inc slipped between 0.1% and 0.5% in trading before the bell on high valuation concerns.

Tesla Inc, however, gained 3% after star investor Cathie Wood’s Ark Invest funds added a further $171 million worth of the company’s shares in the wake of a sharp fall in the electric carmaker’s stock.

Growth-sensitive banks, industrial and energy stocks edged higher with Bank of America, Caterpillar Inc and Chevron Corp up between 0.4% and 0.6%.

The S&P 500 and Dow closed higher on Tuesday, staging a late session turnaround, while the Nasdaq slipped in a tug-of-war between stocks that thrived amid lockdowns and those that stand to benefit most from a reopening economy.

At 06:46 a.m. ET, Dow E-minis were up 9 points, or 0.03% and S&P 500 E-minis were up 1 points, or 0.03%. Nasdaq 100 E-minis were down 24.75 points, or 0.19%.

Wall Street’s main indexes have slid from record highs last week on concerns over a potential spike in inflation, while a climb in Treasury yields continued on expectations of a vaccine-backed and stimulus-supported economic recovery, hitting high-flying shares.

Tech stocks are particularly sensitive to rising yields because their value rests heavily on future earnings, which are discounted more deeply when bond returns go up.

Federal Reserve Chair Jerome Powell pushed back on suggestions that loose monetary policy risked unleashing inflation and said the central bank would keep its attention focused on getting Americans back to work as a vaccine-related recovery proceeds.

Lowe’s Companies Inc rose 0.7% after it beat estimates for quarterly same-store sales, benefiting from sustained demand from people sprucing up their homes during the COVID-19 pandemic.

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