Global markets are poised for a subdued start following a sharp decline in Asian equities driven by a sell-off in technology stocks. Futures for the Euro Stoxx 50 remain largely unchanged, echoing stabilization in US stock futures after a tech-induced selloff on Thursday.
Asian markets witnessed significant losses, with a gauge of tech stocks dropping as much as 3.6%, primarily affecting Japan, South Korea, and Taiwan. This downturn followed a 2.2% decline in the Nasdaq 100, spurred by inflation data that reinforced expectations for rate cuts and prompted investors to move away from tech giants considered safe havens.
Despite these setbacks, global stocks are on track for their sixth consecutive weekly gain, bolstered by expectations of Federal Reserve easing measures which have buoyed overall market sentiment. US inflation figures have led traders to fully price in rate cuts by September.
The yen experienced notable volatility, with market watchers speculating on Bank of Japan interventions following Thursday’s perceived efforts to support the currency.
Gary Tan, a portfolio manager at Allspring Global Investments, noted a rotation out of tech-centric markets like Taiwan and Korea, driven by the previous day’s tech sell-off in the US.
Chinese equities traded in Hong Kong showed resilience, poised for their strongest day in three weeks, buoyed by anticipations of supportive policies ahead of China’s Third Plenum. Meanwhile, Chinese property developers saw substantial gains.
In the bond markets, Treasury yields held steady after a notable decline in 10-year yields prompted by expectations of lower US interest rates. Australian and New Zealand government bonds rallied in tandem.
Ericsson AB reported second-quarter earnings that surpassed analysts’ expectations, citing cost-cutting measures amid what the company described as a challenging market environment.
West Texas Intermediate crude oil advanced for a third consecutive day, supported by the CPI data, while gold retreated following a sharp rally.
Looking ahead, key economic data releases include University of Michigan consumer sentiment and US PPI figures later in the day. Additionally, earnings reports from Citigroup, JPMorgan, and Wells Fargo are anticipated.
Key Market Movements:
Stocks:
1.S&P 500 futures unchanged; Nasdaq 100 futures down 0.1%
2.Japan’s Topix down 1.3%; Australia’s S&P/ASX 200 up 0.8%
3.Hong Kong’s Hang Seng up 2.2%; Shanghai Composite flat
4.Euro Stoxx 50 futures unchanged
Currencies:
1.Bloomberg Dollar Spot Index unchanged; euro steady at $1.0870
2.Japanese yen down 0.1% to 159.07 per dollar; offshore yuan down 0.1% to 7.2751 per dollar
Cryptocurrencies:
1.Bitcoin down 0.9% to $57,063.41; Ether down 1% to $3,084.36
Bonds:
1.Yield on 10-year Treasuries steady at 4.21%; Australia’s 10-year yield down four basis points to 4.33%
Commodities:
1.West Texas Intermediate crude up 0.4% to $82.91 a barrel; spot gold down 0.4% to $2,405.95 an ounce
Related topics:
How Do Stock Futures Work? [Revealed]