Futures slippage, European stocks falter; Dollar Steady: Wrap Markets
(Bloomberg) – US equity futures fell and European stocks erased gains as traders assessed the resilience of the global recovery amid concerns over the strain of the delta virus and risks from China .
The decline in US contracts came ahead of the quarterly expiration of options and futures on Friday, which can trigger volatility. Casinos prolonged decline in pre-market trading amid tightening restrictions in Macau, while miners led Stoxx 600 to drop in Europe as iron ore plummeted to $ 100 a tonne . UK stocks underperformed after retail sales fell unexpectedly for a fourth month in August, the worst string of declines in at least 25 years.
Meanwhile, shares of Commerzbank AG rose following reports that Cerberus Capital is considering increasing its stake. Azelis SA, a distributor of food additives and specialty chemicals, made its debut in Brussels after the largest Belgian IPO since 2007.
Asian stocks were mixed amid the China Evergrande group debt crisis and a short-term cash injection by the central bank to help ease nerves. Yields on the Treasury and the dollar have changed little.
Global stocks are on track for a second weekly decline, held back by the impact of the delta variant on economic reopening, the implications of high inflation and the turmoil in China. The Federal Reserve will likely imply at its meeting next week that it is preparing to cut back on its monthly asset purchases and will make an official announcement in November, according to a Bloomberg survey of economists.
âThe cautiousness over Covid and the lack of jobs data means the Federal Reserve will leave its policy on hold next week, but with inflation remaining high and growth prospects remaining good, we expect a more explicit recognition that the reduction in QE will begin this year, âanalysts from ING Groep NV wrote in a note.
Meanwhile, Martins Kazaks, a member of the Governing Council of the European Central Bank, said in an interview with Bloomberg that the euro area inflation outlook could turn out to be higher than currently expected if the coronavirus does not inflict no new shocks. After its intervention on Thursday, the ECB rejected a Financial Times report that Chief Economist Philip Lane told analysts officials privately expected to meet the target by 2025.
Gabriel Makhlouf, another member of the Governing Council, said on Friday that “fears of excessive inflation in the euro area are overblown.”
Oil slipped, while gold rose. A commodity price index has fallen, but remains in sight of a record high in 2011, underscoring inflationary concerns spilling over into the global economy.
For more market analysis, read our MLIV blog.
Some of the main movements in the markets:
S&P 500 futures fell 0.1% at 8:15 a.m. New York time Nasdaq 100 futures fell 0.1% Dow Jones Industrial Average futures fell little changed Stoxx Europe 600 little changed MSCI World index fell 0.3%
Bloomberg Dollar Spot Index was little changed Euro was up 0.1% to $ 1.1780 British Pound was little changed at $ 1.3800 Japanese Yen fell 0.3% to 110.02 for a dollar
The 10-year Treasury bill yield was little changed at 1.34% Germany’s 10-year yield rose two basis points to -0.28%
West Texas Intermediate crude fell 0.6% to $ 72.19 per barrel Gold futures rose 0.2% to $ 1,759.90 per ounce
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