Stocks fall as pessimism builds on growth, trade
US equity futures dropped with shares in Europe and Asia as concern over economic growth and trade disputes pushed global stock markets toward their first weekly loss since December. Treasuries edged higher with gold.
Contracts on the S&P 500, Dow and Nasdaq Composite all declined, with Hasbro tumbling in the pre-market after its earnings missed the lowest analyst estimate and Amazon edging lower as feuding intensified between its CEO and President Donald Trump.
The Stoxx Europe 600 Index declined and stocks in most of Asia dropped following news that Trump is unlikely to meet Chinese President Xi Jinping before the March 1 deadline for more tariffs. The renewed fears over more protectionist measures also helped push emerging-market equities lower. China’s markets remain shut for Lunar New Year.
For the moment, investors have called time-out on the risk rally that began around Christmas as central banks and governments cast doubt on rosy growth projections. Hours after the European Commission slashed forecasts for the euro region’s major economies Thursday, the Bank of England said the UK may grow at its slowest pace in a decade.
The Reserve Bank of Australia also lowered its growth and inflation forecasts Friday.
"We do think growth will continue positively in the US and Europe, but if we don’t get some positive movement on trade, that’s a risk to the growth story," Kathleen Hughes, global head of liquidity solutions at Goldman Sachs Asset Management, told Bloomberg TV.
Elsewhere, Western Texas Intermediate crude oil steadied
below $53 a barrel in New York. Iron ore futures topped $90 a ton to hit the
highest level since 2014 on concern that the increasingly severe crisis at top
producer Vale SA will reduce global supplies.
These are the main moves in markets:
The Stoxx Europe 600 Index fell 0.3% as of 7:30 New York time. Futures on the S&P 500 Index declined 0.6%. The MSCI World Index of developed countries fell 0.3% to the lowest in more than a week. The MSCI Asia Pacific Index decreased 1.1%.
The Bloomberg Dollar Spot Index rose less than 0.05% with its seventh straight advance. The euro fell less than 0.05% to $1.1337. The Thai baht sank 0.7% to 31.468 per dollar on the largest decrease in more than four months.
The Japanese yen rose less than 0.05% to the strongest in a week. The onshore yuan fell 0.5%, hitting the weakest in more than a week with its sixth consecutive decline and the largest fall in a week.
The yield on 10-year Treasuries fell two basis points to 2.64%. Germany’s 10-year yield fell one basis point to 0.11%. Italy’s 10-year yield rose less than one basis point to 2.952%.
Gold climbed 0.2% to $1 312.33 an ounce. West Texas Intermediate crude fell 0.4% to $52.42 a barrel. LME nickel fell 1.5% to $12 790 per metric ton. LME copper fell 0.3% to $6 230.00 per metric ton.