Stocks, US futures tumble amid China, Fed risks: markets are shrouding

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(Bloomberg) – US equity futures and Asian stocks fell on Monday amid a collapse in Hong Kong real estate developers and nervousness ahead of a Federal Reserve meeting that is expected to hint at a move towards a revival of purification. The dollar has gone up.

US and European contracts fell after the S&P 500 slipped the most in a month, a test for the downward buying mentality as the gauge hits its 50-day moving average. Hong Kong stocks fell, with a report suggesting Beijing may extend its crackdown on private industries to include real estate companies in the city.

Investors are also watching the risk of contagion from the debt crisis at developer China Evergrande Group, which was on track to close at a record market value. A gauge of real estate stocks in Hong Kong has sunk. The offshore yuan has fallen. Australian stocks and currency weakened as iron ore extended its losses below $ 100 per metric tonne.

Ten-year Treasury yields rose ahead of the Fed’s meeting this week, where policymakers are expected to start laying the groundwork for a stimulus package. Japan and China are among the main Asian markets closed for the holidays. There are no cash treasury bills in Asia.

In addition to Evergrande and the prospect of a reduction in Fed stimulus measures, financial markets also face risks related to uncertainty over the outlook for President Joe Biden’s $ 4 trillion economic program as well as the need to raise or suspend the US debt ceiling. Investors were already worried about the slowing global recovery from the pandemic and inflation fueled by commodity prices.

“Inflation is rising in the system, wages are rising, supply chains are driving prices up steadily, and with so many central banks having to make rate decisions, we think it’s a little nervous,” said Tony, president and chief investment officer of Knights of Columbus Asset Advisors. Minopoli, said on Bloomberg Television.

Treasury Secretary Janet Yellen said the US government would be strapped for cash to pay its bills in October without debt ceiling action, warning of “economic catastrophe” unless lawmakers take action required.

Elsewhere, the iron ore rout has intensified as China tightened restrictions on industrial activity in some provinces. In cryptocurrencies, Bitcoin slipped and was trading at around $ 45,700. Other tokens such as Ether have also retreated.

Here are the key events to watch this week:

Canadian Federal Election, Monday Bank of Japan rate decision, Wednesday Federal Reserve rate decision, Wednesday Bank of England rate decision, Thursday Fed Chairman Jerome Powell, Fed Governor Michelle Bowman and Deputy President Richard Clarida discuss pandemic recovery on Friday

For more market analysis, read our MLIV blog.

Some of the main movements in the markets:

Actions

S&P 500 futures fell 0.7% at 6:48 a.m. in London. The S&P 500 fell 0.9%. Futures contracts on the Nasdaq 100 lost 0.5%. Nasdaq 100 fell 1.2% Australian S & P / ASX 200 index fell 1.8% Hong Kong Hang Seng index slipped 3.2% Euro Stoxx 50 futures fell 0.6%

Currencies

The Japanese yen was at 109.91 per dollar.

Obligations

On Friday, the yield on 10-year Treasuries rose two basis points to 1.36%.

Merchandise

West Texas Intermediate crude was at $ 71.38 per barrel, down 0.8% Gold was at $ 1,751.54 per ounce, down 0.2%

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