US stock futures dipped on Thursday as investors weighed strong corporate earnings against growing concerns about persistent inflation. Futures tied to the S&P 500 fell 0.2%, while Nasdaq-100 futures declined 0.5%, extending losses after Wall Street pulled back from record highs in the previous session. Dow futures remained relatively unchanged.
The cautious sentiment was driven by bond yields hitting multi-decade highs, with the 10-year US Treasury yield at 5.28% and the 30-year yield at 5.66%. These levels signal tighter financial conditions and higher borrowing costs, adding pressure on investor confidence. The Federal Reserve's recent meeting minutes revealed unanimous support for a rate hike due to persistently high inflation, despite some recent easing in price pressures.
Earnings reports also influenced market sentiment. PepsiCo reported better-than-expected third-quarter results, with revenue of $25.27 billion, up 5.6% from a year earlier. However, the company cut its profit growth forecast for fiscal 2026, lowering core earnings-per-share growth expectations to 2.5%-3% from the earlier outlook of 5%-7%. Investors are also awaiting the latest US weekly jobless claims data for insights into the labor market's health.
As attention shifts to the third-quarter earnings season, investors are closely watching comments from Federal Reserve Governor Chris Waller for further clues on the path of interest rates. The market remains focused on balancing corporate earnings optimism with inflation worries, which continue to weigh on sentiment.