U.S. Futures Turn Higher, Treasuries Erase Gain: Markets Wrap

U.S. equity futures turned higher on Thursday and Treasuries erased a gain as trade headlines continued to whipsaw global markets. European stocks also reversed a drop, while the region’s bonds held their advance.

A rally in chemicals and mining companies helped pull the Stoxx Europe 600 into the green, Contracts on all three of the main U.S. benchmarks advanced as traders digested President Donald Trump’s moves to curb Huawei Technologies’ access to the American market. Earlier equities fell in Tokyo and slumped in Seoul, while gauges in Hong Kong and China climbed. Treasuries were steady.

Germany's Japanification looks complete

The gyrating yields speak to the elevated level of anxiety across markets, as trade tensions between major economies fester and investors fret the outlook for growth. Equities have oscillated this week as traders scramble to make sense of a slew of headlines. In the latest developments, President Donald Trump signed an order that’s expected to restrict Chinese telecommunications firms from selling their equipment in the U.S., while he’s set to give the European Union and Japan a deadline to agree to “limit or restrict” automobile exports to America.

Amid the confusing landscape, traders have increased bets on the Federal Reserve cutting borrowing costs later this year. Fed Bank of Richmond President Thomas Barkin said while he favors keeping interest rates on hold for now, he worries that business confidence is fragile.

“Depending on how long this standoff with China lasts, that impacts growth for longer and might force the Fed’s hand,” Esty Dwek, senior investment strategist at Natixis Investment Managers, told Bloomberg TV in Singapore. “I wouldn’t expect any big change in the short term, but the possibility of a cut much later in the year has risen.”

Elsewhere, the pound dropped for a ninth day versus the euro — the longest losing streak since 2000 — as U.K. Prime Minister Theresa May faced a new threat to oust her. West Texas oil futures rose for a third day.

Here are some notable events coming up this week:

Here are the main market moves:

Stocks

Currencies

Bonds

Commodities

Source: Bloomberg

 



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