U.S. stock futures dipped in early morning trading on Wednesday as oil prices gained and bond yields touched a fresh multi-year high.
Dow Jones Industrial Average futures were down about 120 points, or 0.4%. S&P 500 futures declined 0.4%, and Nasdaq 100 futures slipped 0.7%.
Oil prices ticked higher on the day, with U.S. crude gaining more than 2% to about $112 per barrel. Brent crude, the international benchmark, advanced about 3% to roughly $119.
The benchmark 10-year U.S. Treasury yield topped 2.41% at its session high Wednesday, the highest since May 2019.
Famed activist investor Carl Icahn said Tuesday an economic downturn could be coming.
“I think there could very well could be a recession or even worse,” Icahn, founder and chairman of Icahn Enterprises, said on CNBC’s “Closing Bell Overtime” to Scott Wapner.
Still, the S&P 500 is only 5% off its record and all three averages are on track to close the month higher.
Wall Street is coming off a strong session Tuesday in which the Dow jumped more than 250 points and the S&P 500 climbed 1.1%.
The Fed last week raised interest rates for the first time since 2018 and forecast a plan to hike rates by a quarter-point at each of the remaining six meetings of 2022. Powell appeared to up the rhetoric even more on Monday, when he promised to take tough action on inflation.
“The labor market is very strong, and inflation is much too high,” the central bank chief told the National Association for Business Economics on Monday. “If we conclude that it is appropriate to move more aggressively by raising the federal funds rate by more than 25 basis points at a meeting or meetings, we will do so.”
Meanwhile, traders digested the latest news on the Ukraine-Russia war. Ukrainian President Volodymyr Zelenskyy called for more pressure on Russia from other countries as the conflict appears to be entering a stalemate.