(Bloomberg) — U.S. and European stock futures fell along with Asian stocks on Tuesday as investors weighed the possibility that central banks would tighten more than expected to rein in inflation.
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Futures contracts for the S&P 500 and Nasdaq 100 lost more than 0.3%, signaling further downward pressure on US stocks after last week’s declines. The MSCI Asia Pacific Index fell as much as 0.5% in mixed trading as Japanese stocks swung between gains and losses, while Chinese stocks moved firmly lower.
The slide in Chinese stocks came after the benchmark CSI 300 index posted its best one-day gain since November on Monday, when strategists at Goldman Sachs Group Inc. said the nation’s stocks could rise about one fifth of current levels this year.
The dollar rose, advancing against its peers in the Group of 10 basket of currencies, as Treasury yields rose in Asia after trading closed for a US holiday on Monday.
The policy-sensitive two-year maturity yield was near its highest since November as traders awaited the release of the PCE deflator, the Federal Reserve’s preferred measure of inflation, later this week.
“While some will focus on US-China relations and point to upcoming meetings between the Chinese and Russians this week, the price revision and rising interest rate expectations will eventually drive the gap across markets. securities,” Chris Weston, head of research at Pepperstone Group Ltd., wrote in a note.
Benchmark two-year New Zealand government bond yields rose on Tuesday, while Australian yields edged higher. Economists expect the Reserve Bank of New Zealand to raise its policy rate by 50 basis points on Wednesday.
Meanwhile, the economic data that has come out so far “certainly throws a lot of cold water” on the argument that the Federal Reserve could pause or even cut rates soon, Chuck Cumello, president and chief executive officer of Essex Financial Services, said on Bloomberg. Radio. “A more volatile ride awaits us and I think the market is finally realizing that rates are going to stay higher for longer,” he said.
Elsewhere, oil trade was choppy as investors weighed the possibility of further monetary tightening against signs of improving demand from China. Gold changed little.
Key events this week:
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Earnings for the week are scheduled to include: Alibaba, Anglo American, AXA, BAE Systems, Baidu, BASF, Danone, Deutsche Telekom, Holcim, Home Depot, Hong Kong Exchanges & Clearing, HSBC, Iberdrola, Lloyds Banking Group, Moderna, Munich Re, Newmont, Nvidia, Rio Tinto, Walmart, Warner Bros Discovery
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PMI for Japan, Eurozone, UK, US, Tuesday
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US existing home sales, Tuesday
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US MBA Mortgage Applications, Wednesday
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The minutes of the Federal Reserve from January 31 to February 31. 1 policy meeting, Wednesday
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Eurozone CPI, Thursday
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US GDP, initial jobless claims, Thursday
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Atlanta Fed President Raphael Bostic speaks Thursday
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G20 finance ministers and central bank governors meet in India from Thursday to Friday
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Japan CPI, Friday
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BOJ-nominated Governor Kazuo Ueda appears before Japan’s lower house on Friday
Some of the main movements in the markets:
Stocks
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S&P 500 futures were down 0.4% at 12:32 p.m. Tokyo time.
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Nasdaq 100 futures fell 0.3%.
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Japan’s Topix Index was little changed
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South Korea’s Kospi index little changed
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Hong Kong’s Hang Seng Index fell 1.1%
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China’s Shanghai Composite Index little changed
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Australia’s S&P/ASX 200 Index fell 0.2%
coins
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The Bloomberg Dollar Spot Index rose 0.1%
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The euro fell 0.2% to $1.0665
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The Japanese yen fell 0.1% to 134.43 per dollar
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The offshore yuan fell 0.2% to 6.8759 per dollar
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The Australian dollar fell 0.1% to $0.6899
CRYPTOCURRENCIES
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Bitcoin rose 0.8% to $24,975.93
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Ether rose 0.4% to $1,707.7
Captivity
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The 10-year Treasury yield rose four basis points to 3.85%.
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Japan’s 10-year bond yield was unchanged at 0.50%
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Australia’s 10-year bond yield rose two basis points to 3.83%
raw Materials
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West Texas Intermediate crude rose 0.4% to $76.61 a barrel
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Spot gold fell 0.1% to $1,838.93 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With the assistance of Akshay Chinchalkar and Richard Henderson.
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