Photographer: Johannes Eisele / AFP / Getty Images
Photographer: Johannes Eisele / AFP / Getty Images
European equities fell and US futures were stable on Thursday as government bond yields stabilized following a renewed wave of bond volatility.
The Stoxx 600 Index fell 0.5%, dragged lower by miners as gold was at a 9-month low. Futures on the S&P 500 and Nasdaq 100 rebounded from an overnight slump, boosted by government bond yields approaching 1.5% on Wednesday and rising inflation expectations.
Revenues fell and the dollar remained stable pending comments from Federal Reserve Chairman Jerome Powell today, where he is is expected to say the central bank will be extremely patient to withdraw its support for the economy after the pandemic ends.
The Asia-Pacific meter from MSCI Inc. experienced its worst decline this week. The technology sector struggled, while real estate, finance and energy stocks outperformed as they shift to value segments.
Wicked Whiplash
Asian stocks will match the longest run of alternating up and down days since 2013
Souce: Bloomberg
The rise in inflation expectations and long-term financing costs are fueling volatility and raising concerns that a protracted rally in equity markets could be jeopardized. Investors are trying to estimate the willingness of central banks to buy longer-dated bonds in order to keep financial conditions flexible. Focus is on Powell’s upcoming comments, after Charles Evans, the president of the Chicago Fed, said the recent rise in interest rates was a reflection of the economy optimism.
“Inflation is a concern; there’s a lot of money sloshing through the system and it makes sense to apply some sort of correction now, ”said Shana Sissel, Spotlight Asset Group’s Chief Investment Officer. “And rising bond yields is the implicit way to tighten the market, as the Fed has made it clear they don’t intend to.”
Read: US inflation expectations hit their highest decade as yields rebounded
Democratic leaders in the Senate are working to consolidate support for the A $ 1.9 trillion stimulus bill that is expected to spur growth. The US economy grew modestly in the first two months of the year, and vaccinations add to the company’s optimism, the Federal Reserve said. Beige book.
Elsewhere, WTI oil traded near $ 62 a barrel, with traders focusing on a pivotal OPEC + meeting that could ease supply constraints, while following events in the Middle East after Houthi rebels said they were a Saudi Aramco site with a missile.
Kevin Foley, global head of debt capital markets at JPMorgan, talks about liquidity in markets and how the pandemic is affecting credit and mergers and acquisitions. s. He’s speaking to Bloomberg’s Ed Hammond.
Some important events to watch this week:
- OPEC + meeting on output Thursday.
- US factory orders, initial unemployment claims and durable goods orders should be expected Thursday.
- Federal Reserve Chairman Jerome Powell speaks on Thursday.
- The February US employment report will provide an update on Friday on the speed and direction of the labor market recovery in the nation.
These are some of the movements in markets:
Shares
- Futures on the S&P 500 Index changed little at 8:20 am London time.
- The Stoxx Europe 600 Index fell 0.4%.
- The MSCI Asia Pacific Index fell 1.8%.
- The MSCI Emerging Market Index fell 1.8%.
Currencies
- The Bloomberg Dollar Spot Index has changed little.
- The euro fell 0.1% to $ 1.2052.
- The British pound had changed little at $ 1.3955.
- The yuan on land changed little, at 6.468 per dollar.
- The Japanese yen weakened 0.2% to 107.20 per dollar.
Bonds
- The yield on 10-year government bonds fell by three basis points to 1.45%.
- Two-year government bond yields fell by less than one basis point to 0.14%.
- The German 10-year return fell three basis points to -0.31%.
- Britain’s 10-year return fell two basis points to 0.755%.
- The Japanese 10-year yield increased by one basis point to 0.132%.
Raw materials
- West Texas Intermediate crude gained 0.7% to $ 61.69 a barrel.
- Brent crude oil gained 0.7% to $ 64.55 a barrel.
- Gold gained 0.4% to $ 1,717.78 an ounce.