Nasdaq futures lose ground as Fed's Brainard turns from dove to hawk and spikes yields


  • Nasdaq futures close sharply lower on Tuesday, down 2.2%.
  • NASDAQ 100 hit by rising bond yields and hawkish central bankers.
  • The main tech index futures losing more ground on Wednesday.

The Nasdaq futures contract was once again the laggard on Tuesday, closing down over 2%. The S&P 500 was down 1.2% while the Dow Jones futures were down 0.8%. 

Also readGGPI fails to hold gains from Hertz partnership

Nasdaq futures news: Brainard hits high-growth sectors

The hawkish comments from Fed speaker Lael Brainard sent bond yields sharply higher on Tuesday and that had obvious knock-on effects for equities. The Nasdaq futures always have the most to lose in the face of rising yields and so it proved. In particular, Brainard said “It is of paramount importance to get inflation down. We will continue tightening monetary policy methodically through a series of interest rate increases and by starting to reduce the balance sheet at a rapid pace as soon as our May meeting.” She said the Fed balance sheet is expected “to shrink considerably more rapidly than in the previous recovery, with significantly larger caps and a much shorter period to phase in the maximum caps compared with 2017-19.” That last comment was the real kicker for equities as bond yields spiked.

Another Fed speaker, this time Mary Daly took to the airwaves later and added to the hawkish stance. Both Brainard and Daly would usually be associated with dovish outlooks (lower, less aggressive interest rates). That led yields higher and put further likelihood of a nailed-on 50bps rate hike in May. 

Nasdaq futures forecast: Weakening momentum

We continue to see a worsening flow-related outlook for the NASDAQ 100. We identified weakening momentum across corporate buybacks entering blackout and weakening demand from trend-following funds as well as fund managers now being slightly overweight equities. The repeated failure to break 15,259 showed the slowing momentum. This was a strong resistance area in terms of volume and the 200-day moving average. Failure has led to the current declines with macro factors backing up the move. 

Nasdaq futures daily chart

Nasdaq futures chart, daily

Taking a closer look at the hourly level we see 14,600 as support for Nasdaq futures. A break will target 14,447. The 15,259 mark is also the key short-term pivot. Remaining below this level keeps the Nasdaq futures bearish in the short term.

Nasdaq futures 1-hour chart

Nasdaq futures chart, hourly

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Recommended content


Recommended content

Editors’ Picks

EUR/USD trades sideways below 1.0450 amid quiet markets

EUR/USD trades sideways below 1.0450 amid quiet markets

EUR/USD defends gains below 1.0450 in European trading on Monday. Thin trading heading into the Xmas holiday and a modest US Dollar rebound leaves the pair in a familair range. Meanwhile, ECB President Lagarde's comments fail to impress the Euro. 

EUR/USD News
GBP/USD stays defensive below 1.2600 after UK Q3 GDP revision

GBP/USD stays defensive below 1.2600 after UK Q3 GDP revision

GBP/USD trades on the defensive below 1.2600 in the European session on Monday. The pair holds lower ground following the downward revision to the third-quarter UK GDP data, which weighs negatively on the Pound Sterling amid a broad US Dollar uptick. 

GBP/USD News
Gold price holds comfortably above $2,600 mark; lacks bullish conviction

Gold price holds comfortably above $2,600 mark; lacks bullish conviction

Gold price oscillates in a range at the start of a new week amid mixed fundamental cues. Geopolitical risks continue to underpin the XAU/USD amid subdued US Dollar price action. The Fed’s hawkish stance backs elevated US bond yields and caps the pair’s gains.

Gold News
The US Dollar ends the year on a strong note

The US Dollar ends the year on a strong note

The US Dollar ends the year on a strong note, hitting two-year highs at 108.45. The Fed expects a 50-point rate cut for the full year 2025 versus 4 cuts one quarter earlier, citing higher inflation forecasts and a stubbornly strong labour market. 

Read more
Bank of England stays on hold, but a dovish front is building

Bank of England stays on hold, but a dovish front is building

Bank of England rates were maintained at 4.75% today, in line with expectations. However, the 6-3 vote split sent a moderately dovish signal to markets, prompting some dovish repricing and a weaker pound. We remain more dovish than market pricing for 2025.

Read more
Best Forex Brokers with Low Spreads

Best Forex Brokers with Low Spreads

VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.

Read More

Forex MAJORS

Cryptocurrencies

Signatures