Stocks fell along with U.S. futures on Tuesday, with investors reflecting on a possible delay in the planned U.S. fiscal relief package in a scenario of concern that some markets are overloaded. The dollar advanced.
An indicator of Asia-Pacific stocks at one point fell further in about two months, with stocks in South Korea and China outperforming. The fall of Tencent Holdings Ltd. caused Hong Kong’s stock to drop after the market giant’s market cap rose to the cusp of $ 1 trillion for the first time on Monday. The People’s Bank of China withdrew funds unexpectedly from the financial system as a advisor discussed the risk of asset bubbles in local media.
S&P 500 futures fell as Senate majority leader, Chuck Schumer said a help package was unlikely before mid-March and a US health official expressed concern about delays in vaccination. Nasdaq 100 contracts also pointed down, with investors awaiting gains from some of the biggest companies.
Elsewhere, Treasury bills held up overnight and crude oil floated below $ 53 a barrel. European stock futures have changed little.
Global stocks have retreated from a record as investors look for new catalysts to push them up or at least justify current valuations. This may come from a list of earnings reports due this week. Meanwhile, the possibility that a U.S. tax relief package could be delayed is undermining one of the main reasons why Treasury yields rose earlier this year.
“If financial markets needed any further confirmation that the US fiscal stimulus was the only game in town, the buy-all herd received overnight,” wrote Jeffrey Halley, senior market analyst at Oanda Asia Pacific Pte., On a note. Senate Republicans’ concern about the size of the planned package “was enough to topple the shares of their senior intraday workers”, reduce bond yields and stimulate demand for the dollar, he said.
President Joe Biden said he is open to negotiations over his $ 1.9 trillion Covid-19 bailout proposal, and hopes to attract Republicans, although he has not ruled out the possibility of following an exclusively Democratic path. Schumer said on Monday that he plans to secure approval for the next round of relief by mid-March, just when the unemployment benefits from the last package will be running out.
On the front of the pandemic, vaccination coverage will not reach a point that will stop transmission of the virus in the near future, the World Health Organization. U.S. infectious disease chief Anthony Fauci said he was concerned about delays in second doses.
These are some important events that will take place next week:
- Microsoft Corp., Apple Inc., Tesla Inc., Facebook Inc., UBS Group AG and Samsung Electronics Co. is among the companies that report results.
- Data on house prices in the US and consumer confidence arrive Tuesday.
- The Federal Open Market Committee’s monetary policy decision and President Jerome Powell’s briefing are scheduled for Wednesday.
- Fourth-quarter GDP, initial jobless claims and new home sales are among the data released in the U.S. on Thursday.
- Personal income, expenses and pending home sales in the US arrive Friday.
These are the main movements of the markets:
Stocks
- S&P 500 futures fell 0.5% as of 5:30 am in London. The S&P 500 index rose 0.4%.
- The Topix index fell 0.5%.
- The Kospi index fell 2%.
- The Hang Seng index fell 1.9%.
- The Shanghai Composite Index fell 1.4%.
- Euro Stoxx 50 futures fell 0.1%.
Coins
- The Bloomberg Dollar Spot Index added 0.1%.
- The euro was at $ 1.2130.
- The pound sterling fell 0.2% at $ 1.3652.
- The Japanese yen has barely changed at 103.74 per dollar.
- The offshore yuan rose 0.1% to 6.4832 per dollar.
Titles
- Yield on 10-year Treasury bonds rose one basis point to about 1.04%, after dropping six basis points on Monday.
Commodities
- West Texas Intermediate crude oil fell 0.7% to $ 52.40 a barrel.
- Gold was up 0.1% to $ 1,857 an ounce.
– With the help of Vivien Lou Chen, Katherine Greifeld and Joanna Ossinger