This week’s China selloff added to investor worries about the threat to global growth from the delta variant and the potential for tighter policy.
Bloomberg: U.S. futures drifted and stocks were mixed as investors weighed earnings from technology heavyweights. Treasuries fell ahead of the Federal Reserve’s rate decision.
Contracts on the Nasdaq 100 Index and the S&P 500 fluctuated as Alphabet Inc. gained in premarket on strong sales, while Apple Inc. dropped on concern over slower growth. Pfizer Inc. rose after raising its revenue outlook, driven by Covid-19 vaccines. European shares trimmed gains, while a gauge of Asia-Pacific shares fell to its lowest this year.
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While strong earnings are boosting confidence in the corporate recovery, this week’s China selloff added to investor worries about the threat to global growth from the delta variant and the potential for tighter policy. Treasuries fell ahead of today’s Fed decision, at which officials are expected to discuss how and when to taper stimulus.
“Investors appear to be grappling with the diverging risks of a slowing of the global economy, due to rising infection rates, against the risks of rising prices,” said Michael Hewson, chief market analyst at CMC Markets. While the Fed meeting is “unlikely to change the overall narrative when it comes to the timing of a taper,” it may offer an insight into whether the recent hawkishness from Fed officials such as James Bullard and Raphael Bostic is starting to spread to other members, he added.
Elsewhere, West Texas Intermediate crude oil traded near $72 a barrel and Bitcoin climbed above $40,000, continuing a recent recovery.
In China, equities closed slightly higher after intraday swings amid the state media’s efforts to reassure investors about the country’s regulatory crackdown. The Hang Seng Index reversed losses after being on the verge of a bear market.
Here are some key events to watch this week:
Facebook, Amazon report earnings this week
Federal Reserve policy meeting concludes Wednesday
U.S. GDP data are due Thursday
Here are the main moves in the markets:
Futures on the S&P 500 were little changed as of 6:45 a.m. New York time
Futures on the Nasdaq 100 rose 0.1%
Futures on the Dow Jones Industrial Average fell 0.1%
The Stoxx Europe 600 rose 0.4%
The MSCI World index was little changed
The Bloomberg Dollar Spot Index was little changed
The euro was little changed at $1.1806
The British pound was little changed at $1.3877
The Japanese yen fell 0.2% to 109.97 per dollar
The yield on 10-year Treasuries advanced one basis point to 1.25%
Germany’s 10-year yield declined one basis point to -0.45%
Britain’s 10-year yield was little changed at 0.57%
West Texas Intermediate crude rose 0.5% to $71.98 a barrel
Gold futures were little changed