Investing.com - U.S. stock futures pointed to a modestly lower open on Wednesday morning, as investors continued to monitor movements in the U.S. dollar and the bond market.
The blue-chip Dow futures dipped 33 points, or 0.17%, by 6:55AM ET (11:55GMT), the S&P 500 futures inched down 5 points, or 0.22%, while the tech-heavy Nasdaq 100 futures slumped 12 points, or 0.24%.
Wall Street ended higher on Tuesday, with the Dow recording its seventh winning session in a row and its fourth straight record close, as the market's focus remained squarely on the policies of President-elect Donald Trump.
The Republican has said that he planned to spend on infrastructure and cut taxes to stimulate the economy and spur inflation, which would ultimately lead to an era of higher interest rates.
Investors are currently pricing a 90.6% chance of a rate hike at the Fed's December 13-14 meeting, according to Investing.com's Fed Rate Monitor Tool.
Optimism over the U.S. economic outlook and expectations of higher interest rates continued to boost the greenback.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.27% at 100.47 early Wednesday, after touching 100.50, the highest since December 2015.
If the index rises above the highs of 100.51 set in December 2015, it would reach its highest level since April 2003.
Against the yen, the dollar was up 0.45% at a more than five-month peak of 109.67, while the euro lost 0.2% to hit an eight-month trough of 1.0700.
The dollar's rise moved in step with the surge in U.S. yields, as markets continued to bet that Trump would usher in inflationary policies.
The yield on the 10-year Treasury was hovering near intraday high of 2.280%, within sight of a 10-month peak of 2.302% set earlier in the week.
Market players are looking ahead to U.S. economic data later in the session for further hints on the strength of the economy. PPI data is due at 8:30AM ET, industrial production at 9:15AM ET, and NAHB homebuilders sentiment at 10:00AM ET.
There are also a few Fed speakers Wednesday, ahead of Fed Chair Janet Yellen's congressional testimony Thursday.
Minneapolis Fed President Neel Kashkari, St. Louis Fed President James Bullard and Philadelphia Fed President Patrick Harker are all scheduled to deliver comments throughout the day.
Among active pre-market movers, Lowe’s (NYSE:LOW) saw shares slide more than 5% after the home improvement retailer reported quarterly earnings and revenue that missed analysts' expectations ahead of Wednesday's opening bell.
On the upside, Target (NYSE:TGT) shares jumped nearly 7% after the company topped Wall Street's sales and earnings estimates, thanks to a rise in traffic and sales trends that helped boost profits.
Elsewhere, European and U.K. stock markets were mostly lower in choppy trade, as markets took a breather from the recent post-U.S. election rally. Earlier, Asian shares closed mixed.
Meanwhile, oil futures gave back some of the prior session's near 6% jump as market players awaited fresh weekly information on U.S. stockpiles of crude and refined products.
The U.S. Energy Information Administration will release its weekly report on oil supplies at 10:30AM ET (15:30GMT) Wednesday, amid analyst expectations for an increase of 1.480 million barrels.