(Bloomberg) – US stocks hit four-week lows and bond yields rose as investors assessed the resilience of the global recovery amid concerns about the strain of the delta virus and risks coming from China.
The drop precedes the quarterly expiration of options and futures on Friday, which can trigger volatility. The materials and tech sectors pushed the S&P 500 into the red for a second day, erasing the gains from the start of the week. Casinos extended their decline amid tighter restrictions in Macau, while miners led the Stoxx 600 index down in Europe as iron ore slumped to $ 100 a tonne.
“September typically starts off with stocks struggling to maintain optimism over a likely change in Fed policy, slower growth and uncomfortably high inflation,” wrote Gina Martin Adams of Bloomberg Intelligence in a note.
The University of Michigan’s preliminary confidence index showed US consumer confidence edged up in early September, but remained near a near-decade low, as buying conditions deteriorated. at their worst since 1980 due to high prices.
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.
“We are not necessarily in a time of many negative catalysts, we are in a time of lack of positive catalysts,” said Randy Frederick, managing director of trading and derivatives at the Schwab Center for Financial Research. “And we might not get a huge boost until we get something positive like potential profits, which is still a few weeks away.”
Global stocks are on track for a second weekly decline, held back by the impact of the delta variant on the economic reopening, the implications of high inflation and the turmoil in China. The Federal Reserve will likely hint 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.
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.
Oil slipped, while gold rose. A commodity price index fell, but remains within sight of a record high in 2011, underscoring inflationary concerns that are spilling over into the global economy.
For more market analysis, read our MLIV blog.
Some of the main movements in the markets:
The S&P 500 fell 0.7% at 12:15 p.m. New York time The Nasdaq 100 fell 1.1% The Dow Jones Industrial Average fell 0.5% The MSCI World index fell 0.6%
Bloomberg Dollar Spot Index rose 0.3% Euro fell 0.3% to $ 1.1735 British pound fell 0.3% to $ 1.3759 Japanese yen fell 0 , 2% to 109.96 per dollar
The 10-year Treasury bill yield rose three basis points to 1.37% Germany’s 10-year yield rose two basis points to -0.28%
West Texas Intermediate crude fell 1.1% to $ 71.82 per barrel. Gold futures fell 0.2% to $ 1,752.70 an ounce
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