U.S. equity futures fluctuated and Asian stocks were steady Monday as traders weighed the volatile slump in cryptocurrencies, the inflation outlook and China’s intensifying effort to cool raw-materials prices. Shares posted modest gains in Japan and Australia but retreated in Hong Kong. S&P 500, Nasdaq 100 and European equity contracts oscillated after U.S. stocks closed mixed on Friday. Bitcoin advanced to about $35,100 following another weekend of big swings.
The stalling commodities boom remains in focus as China tries to temper speculation, with the nation vowing severe punishment for violations ranging from excessive speculation to spreading fake news.
Market-based gauges of inflation expectations have declined of late, but concerns linger that the post-pandemic recovery could stoke price pressures and force a pullback in extraordinary central bank support. Treasury yields and the dollar were steady.
Global equities have lost some steam and speculative ardor for riskier investments like Bitcoin has declined after a prolonged rally from pandemic lows. While the economic recovery from the health crisis offers background support for sentiment, investors are wary that policy makers may eventually have to cu
Contracts on the S&P 500 and Nasdaq 100 gauges pointed to gains after U.S. stocks closed mixed on Friday. The dollar and Treasuries were steady. Bitcoin advanced above $35,000 following another weekend of big swings. The Stoxx Europe 600 struggled for traction while shares posted small gains in Japan, China and Australia but retreated in Hong Kong.
China’s crackdown on commodities speculation weighed on raw-material prices, with steel dropping more than 5% and iron ore tumbling by close to the daily limit. Bloomberg’s industrial metals subindex declined for a fourth day to a one-month low.
Implied volatility for major global indexes remains subdued, suggesting investors aren’t pricing in a surprise from the Fed in the next six months. While market-based gauges of inflation expectations have declined recently, concerns linger that the post-pandemic recovery could stoke price pressures, and some countries also face Covid-19 spikes. Robust corporate earnings, especially in Europe, is underpinning stock prices.
“It’s going to be a very mixed market over the next several months until we get more information on what’s really going to happen with inflation and how the stimulus in the U.S. affects spending there, but also how the coronavirus really progresses,” JoAnne Feeney, a partner at Advisors Capital Management LLC, said in a Bloomberg TV interview.
WTI crude oil climbed above $64 a barrel amid further signs the U.S. is recovering from the pandemic. Traders also monitored progress in talks to revive an Iranian nuclear deal that could lead to increased global crude supply. [BLOOMBERG]
