(Bloomberg) – U.S. stock futures signaled a softer approach on Wall Street as traders braced for a slew of economic data that will help determine the direction of monetary policy.
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Contracts on the tech-heavy Nasdaq 100 fell 0.4%. Nvidia shares, which have led the chipmaker’s stock rally amid the frenzy over artificial intelligence, fell as much as 2.1% premarket. S&P 500 futures fell 0.3%. In Europe, the Stoxx 600 index edged lower as investors digested the latest gains. ASM International NV fell after the chip equipment maker’s disappointing earnings forecast.
Aside from earnings, attention will be focused on US GDP and inflation numbers, as well as the central bank’s strong lineup of speakers. Investors are grappling with lower expectations about how much the US Federal Reserve (Fed) and European Central Bank (ECB) will cut interest rates.
Guy Miller, chief market strategist at Zurich Insurance, said: “In December, markets were pricing in a significant rate cut in 2024, but what is actually happening is a somewhat problematic inflation situation in most parts of the world. “The U.S. economy is doing well,” he said. The labor market remains tighter than many expected, and wage growth is faster than central bankers are comfortable with. ”
Traders are now pricing in only 75 basis points of US easing through the end of the year, consistent with the most likely outcome given by Fed policymakers in December. U.S. Treasury yields fell on Wednesday, and the dollar benchmark rose to its highest since February 20.
Cryptocurrency-related stocks rose as Bitcoin rose for the fifth day in a row, marking the biggest monthly increase since October 2021. The launch of a spot Bitcoin exchange-traded fund in the United States in early January overcame concerns about Bitcoin’s decline and led to a surge in buying. Fed rate cut. Bitcoin soared above $59,000 on Wednesday, up almost 40% in the month.
Hong Kong’s stock benchmark fell more than 1% after the city’s budget report failed to impress investors. Chinese stocks fell after recent gains hit resistance levels, with traders looking for momentum from this week’s manufacturing report and a key political conference in Beijing next week.
Crude oil fell after a second day of gains on signs of rising U.S. inventories and hopes that OPEC+ will extend supply cuts. Iron ore fell again as investors remained undecided on the strength of China’s steel demand ahead of China’s usual peak construction season.
Elsewhere, the New Zealand dollar fell more than 1% after the Reserve Bank of New Zealand issued less hawkish comments on inflation, citing a decline in most measures of price expectations. did.
Meanwhile, the Nigerian naira fell to new lows after the central bank’s much larger-than-expected 400 basis point interest rate hike on Tuesday failed to support the naira. Naira is being depleted due to local dollar shortage and unpaid dollar demand.
This week’s main events:
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US wholesale inventories, GDP, Wednesday
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Fed’s Rafael Bostic, Susan Collins and John Williams speak on Wednesday
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G20 finance ministers and central bank chiefs will meet in Sao Paulo from Wednesday to Thursday
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German CPI, unemployment rate, Thursday
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US Consumer Income, PCE Deflator, New Unemployment Insurance Claims, Thursday
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Fed’s Austan Goolsby, Raphael Bostic and Loretta Mester speak Thursday
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China official PMI, Caixin manufacturing PMI, Friday
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Eurozone S&P World Manufacturing PMI, CPI, Unemployment Rate, Friday
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BOE Chief Economist Hugh Pill speaks on Friday
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US Construction Spending, ISM Manufacturing, University of Michigan Consumer Sentiment, Friday
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Fed’s Rafael Bostic and Mary Daly speak on Friday
The main movements in the market are:
stock
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As of 6:33 a.m. New York time, S&P 500 futures were down 0.3%.
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Nasdaq 100 futures fell 0.4%
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Dow Jones Industrial Average futures fell 0.3%.
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Stoxx European 600 drops 0.2%
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MSCI World Index falls 0.2%
currency
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Bloomberg Dollar Spot Index rose 0.2%
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The euro fell 0.3% to $1.0816.
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The British pound fell 0.3% to $1.2650.
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The Japanese yen remained almost unchanged at 150.64 yen to the dollar.
cryptocurrency
bond
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The 10-year Treasury yield fell 2 basis points to 4.28%.
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Germany’s 10-year bond yield fell 3 basis points to 2.44%.
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UK 10-year bond yields fell 2 basis points to 4.17%.
merchandise
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West Texas Intermediate crude oil fell 0.9% to $78.15 a barrel.
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Spot gold fell 0.2% to $2,027.40 an ounce.
This article was produced in partnership with Bloomberg Automation.
–With assistance from Winnie Hsu and Robert Brand.
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