This is what you need to watch Thursday

Earnings from Macy's and Kohl's and weekly jobless claims data roll out ahead of Wall Street's opening bell Thursday.

Stock futures were higher ahead of the open, and Treasury yields were higher. Oil futures were slightly higher.

A risk-off mood pervaded markets Wednesday, as oil slid and investors reached for yield in the bond market. On Thursday, there is a $15 billion 30-year bond auction at 1 p.m. EDT, which could be well received if it follows the pattern in Wednesday's 10-year note auction.

Kohl's reported earnings of $1.22 per share, before items, on revenues of $4.18 billion. Kohl's rose nearly 7 percent ahead of the opening bell.

Shares of Chinese online retailing giant Alibaba rose ahead of the bell after the company reported better than expected earnings.

Shoppers leave the Macy's Herald Square store in New York City.
Brendan McDermid | Reuters
Shoppers leave the Macy's Herald Square store in New York City.

The U.S. department stores, however, are expected to see earnings and revenues decline, a longtime pattern for the industry as internet sales in the U.S. grow.

Macy's earnings per share are expected to fall 30 percent to $0.45 per share, while revenues are expected to fall by 6 percent to $5.75 billion, according to Thomson Reuters. Kohl's earnings per share are expected to fall 4 percent to $1.03 per share, on revenues of $4.2 billion, a 2 percent decline.

"Remarkably, department store sales are lower than they were in 2000," said Jack Ablin, CIO of BMO Private Bank. Nordstrom also reports after the closing bell, as do Petrobras, Planet Fitness, Ruby Tuesday, Acacia and Viavi Solutions.

Import prices are expected at 8:30 a.m. EDT, at the same time the government reports jobless claims, expected at 265,000.

Stocks slid Wednesday as oil declined 2.5 percent. The Dow was down 37 points at 18,495, and the S&P 500 lost 6 to 2,175. West Texas Intermediate crude futures were down $1.06 per barrel to $41.71 per barrel, on a surprise build in U.S. crude supply and on news of increased OPEC production.

Treasury yields also fell, as buyers snapped up U.S. government bonds while the yields of other sovereigns continued to shrink. The Bank of England stumbled in its easing efforts Wednesday, finding a shortage of U.K. gilts available for its quantitative easing program. That sent global yields broadly lower.

"The global backdrop is really what's driving our market at the moment. We came in today and yields were lower, 30-year gilts were significantly lower," said Lisa Hornby, portfolio manager at Schroders. "There's a bit of risk off sentiment with oil. That's contributed to a little bit of a further rally in the Treasury market."

The U.S. 10-year was yielding 1.50 percent Wednesday afternoon, after the $23 billion 10-year auction stopped at 1.503 percent. According to Jefferies, it was the second-lowest-yielding 10-year note auction of all time and the proportion of indirect bidders — a group which includes foreign buyers — was 72 percent, the third highest ever.

"We're the last hoorah for yield," said Ablin of the Treasury market. U.S. Treasurys looked even more attractive Wednesday, as U.K. 10-year gilts hit a new all-time low yield of 0.51 percent. Now the spread between U.S. and U.K. 10-year yields is the widest its been since June 2000, according to Reuters.

"You have to separate what you think the central banks should do from what they will likely do," he said. "My sense is they've gone so far with monetary policy and they've gotten away with so much that hasn't gotten much blow back, that they're emboldened. I think we're going to see them cross the line and Japan will probably do it first. I don't think helicopter money is that far away. They've tripled their balance sheets and we haven't seen one iota of inflation."

The Bank of England was reported to be 52 million pounds short of its QE bond purchase target. The problems with the BOE QE program led to market chatter that the central banks really are running out of bullets.

"I don't think they're going to fold up their tents and give up," said Ablin.