U.S. futures are relatively unchanged after the U.S. Treasury Department said it would at least double the size of its bond buybacks, and oil prices shot higher.
The planned purchases of longer-term government debt by the Treasury could ease pressure on share prices since the maneuver would push bond yields down.
Futures for the S&P 500 were little changed on Thursday, while those for the Dow Jones Industrial Average slipped 0.1 per cent. Nasdaq futures gained 0.1 per cent.
Oil prices rose sharply after ballistic missile fire in United Arab Emirates triggered nationwide warnings residents there, the first time in weeks such an alarm had sounded. President Donald Trump threatened to increase economic pressure on Iran, creating more doubts about a near-term solution to the conflict.
Brent crude, the international standard, surged 2.5 per cent to US$93.90 a barrel. It was trading at roughly US$72 per barrel before the war.
U.S. benchmark crude jumped 2.8 per cent to US$86.72 a barrel.
Yields on U.S. government bonds fell after the Treasury announcement. Yields have risen in recent months over growing concerns about inflation stemming from the conflict in Iran and ballooning government debt.
The national debt surpassed a record US$40 trillion on Wednesday with defense spending soaring and the U.S. involvement in the Middle East.
The yield on the U.S. 10-year Treasury fell to 4.68 per cent on Thursday, although it’s still well above its levels from before the start of the war in Iran. The 30-year Treasury yield fell to around 5.22 per cent.
In Asia, bond yields also eased after the U.S. Treasury’s announcement. Japan’s 10-year government bond yield fell to around 2.85 per cent. It has been trading near 30-year highs.
Walmart’s stock slid more than 6 per cent before the market open on Thursday as the retail giant gave a cautious outlook for the year. Walmart is considered a barometer of consumer spending given its vast customer base.
Investors are also awaiting the latest U.S. unemployment data. The previous report from the Labor Department said that 209,000 people filed jobless claims two weeks ago, up from a revised 200,000 the week before and higher than the 205,000 forecasters had expected.
In Europe, Germany’s DAX fell 0.5 per cent to 25,960.44, while the CAC 40 in Paris slipped 0.4 per cent to 8,466.75. Britain’s FTSE 100 shed 0.3 per cent to 10,707.92. Asian shares traded higher.
The U.S. dollar rose to 158.50 Japanese yen from 158.16 yen. The euro was trading at US$1.1696, up from US$1.1677.
Chan Ho-him And Michelle Chapman, The Associated Press
