By Devik Jain and Shreyashi Sanyal
(Reuters) – U.S. stock index futures fell on Thursday as investors resumed a shift out of big technology firms ahead of data that is expected to show a steady recovery in the labor market.
The Labor Department’s report at 8:30 a.m. ET is expected to show that the number of Americans filing new applications for unemployment benefits decreased to 765,000 last week as a drop in COVID-19 cases allowed more businesses to reopen.
Wall Street’s main indexes hit record highs at the beginning of the week but gradually retreated following a rise in treasury bond yields, which led to fears of higher inflation.
These concerns have spurred profit-taking from companies with high valuations in the S&P 500 technology and communications services sectors, that have led the benchmark index gain 76% from its March 2020 lows.
Apple Inc, Microsoft Corp, Amazon.com Inc, Alphabet Inc and Facebook Inc, which together account for about 22% of the weight of the S&P 500, were down between 0.7% and 2.2%.
“A steady slow increase may not necessarily disrupt the uptrend in equities but will likely force rotation from highly priced stocks, typically in the tech sector, to more reasonably priced cyclical ones, ” said Hussein Sayed, chief market strategist at FXTM.
Shares of Walmart Inc and Marriott International fell about 2% after the companies reported quarterly results.
Fourth-quarter earnings season have been largely upbeat, while investors eyed progress in countrywide vaccination efforts and hopes of $1.9 trillion dollar stimulus package.
At 6:50 a.m. ET, Dow e-minis were down 77 points, or 0.24%, S&P 500 e-minis were down 16.25 points, or 0.41%, and Nasdaq 100 e-minis were down 106.75 points, or 0.78%.
(Reporting by Devik Jain and Shreyashi Sanyal in Bengaluru; Editing by Saumyadeb Chakrabarty)
