U.S. Futures Slide on Virus Spike; Treasuries Jump: Markets Wrap
Yakob PeterseilBloombergJuly 10, 2020 0:20 5:03 Markets, Economies Will Normalize Over Next Year: Pimco’s Browne
(Bloomberg) — U.S. futures slid on Friday as a buying frenzy in China cooled and concern resurfaced that a rising number of coronavirus cases will hurt the global economic recovery. Treasuries jumped, sending five-year yields near a record low.
Contracts on the main American equity benchmarks traded in the red, following record deaths in Florida, Texas and California from the virus. China shares slumped as selling by state-backed funds signaled authorities wanted to slow the pace of gains following the Shanghai Composite’s eight-day winning run.
Tech shares helped the Stoxx Europe 600 Index erase an earlier decline after Apple chipmaker TSMC posted revenue just above estimates for the June quarter. Carlsberg A/S climbed after it said the slump in western European beer sales has moderated.
With record deaths across the U.S., as well as fears of a second wave in Asia, the spotlight is back on the spread of the coronavirus as investors head into the weekend. While optimists are betting that fiscal and monetary support will contain the fallout, and U.S. jobs data Thursday came in better than expected, others point out that the labor market is still treacherous.
“We’re going to see intermittent periods of shutdowns over the next year or so while we’re still grappling with this virus,” Erin Browne, a multi-asset portfolio manager at Pacific Investment Management Co. said on Bloomberg TV. “But I wouldn’t expect we’re likely to see a wholesale shutdown of the U.S. economy like we saw earlier this year.”
Elsewhere, oil traded around $39 a barrel in New York. In the U.K., yields on two- and five-year notes hovered near all-time lows amid speculation that the Bank of England may further ease monetary policy.
These are the main moves in markets:
Futures on the S&P 500 Index dipped 0.4% as of 6:16 a.m. New York time.The Stoxx Europe 600 Index climbed 0.3%.The MSCI Asia Pacific Index declined 0.9%.The MSCI Emerging Market Index sank 1%.
The Bloomberg Dollar Spot Index was little changed.The euro gained 0.1% to $1.1294.The British pound increased 0.1% to $1.2613.The onshore yuan weakened 0.2% to 7.004 per dollar.The Japanese yen strengthened 0.4% to 106.75 per dollar.
The yield on 10-year Treasuries fell four basis points to 0.58%.The yield on two-year Treasuries fell one basis point to 0.14%.Germany’s 10-year yield fell two basis points to -0.49%.Britain’s 10-year yield declined one basis point to 0.145%.Japan’s 10-year yield decreased less than one basis point to 0.027%.
West Texas Intermediate crude declined 2.5% to $38.61 a barrel.Brent crude decreased 2.2% to $41.43 a barrel.Gold strengthened 0.2% to $1,806.83 an ounce.