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US STOCKS-Futures rise as spike in bond yields eases

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* Futures up: Dow 0.22%, S&P 0.24%, Nasdaq 0.47%

March 19 (Reuters) - U.S. stock index futures edged higher on Friday following a steep pullback in the prior session as bond yields withdrew from 14-month peaks and oil prices retraced some losses.

Oil majors Chevron Corp and Exxon Mobil Corp added 1.2% and 1.5% in premarket trading as crude prices stabilized a day after a selloff driven by concerns over demand.

FedEx Corp jumped about 3% after the U.S. delivery firm said quarterly profit jumped more than expected on higher prices and surging volume from pandemic-fueled e-commerce deliveries during the holiday shipping season.

Yields on U.S. 10-year notes, which have risen sharply in the past seven weeks on growth expectations, edged lower on Thursday to 1.687% after touching their highest since January 2020 peak of 1.754%.

Optimism over a $1.9 trillion fiscal package and the Federal Reserve’s promise to maintain its ultra-loose policy stance for years has accelerated a shift into economy-linked stocks, powering the S&P 500 and the Dow to record levels this week.

However, the Nasdaq is still about 7% below its Feb. 12 all-time closing high as technology and high-growth stocks have lost favor, with their valuations looking expensive with a jump in yields.

Several bond managers believe the recent pace of the rise in yields in the U.S. Treasury market has been unsettling and also worry the market could be viewed as disorderly if the momentum continues.

Investors are turning their attention to prospects that higher taxes could threaten the rally in U.S. stocks as President Joe Biden’s administration moves forward with its agenda and seeks ways to pay for its spending plans.

Yield-sensitive tech stocks such as Apple Inc, Facebook Inc, Netflix Inc, Amazon.com Inc and Microsoft Corp gained nearly 0.6% in premarket trading.

At 06:35 a.m. ET, Dow E-minis were up 71 points, or 0.22%, S&P 500 E-minis were up 9.5 points, or 0.24% and Nasdaq 100 E-minis were up 59.5 points, or 0.47%.

Market trading volumes are expected to rise on Friday due to “quadruple witching,” in which futures and options expiries occur, and that typically also translates into elevated liquidity.

Nike Inc dropped about 2.7%, leading losses among the 30 Dow components trading before the bell, after the company missed quarterly sales estimates due to shipping issues and a pandemic-related slump at brick-and-mortar stores. (Reporting by Shashank Nayar and Medha Singh in Bengaluru; Editing by Maju Samuel)

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