(Bloomberg) — U.S. equity futures declined, erasing earlier gains, as Federal Reserve Chair Jerome Powell said the central bank’s upbeat economic forecast reflected the upshot from fiscal stimulus and progress with vaccinations. Oil turned lower after a rally spurred by the blockage of the Suez Canal fizzled.
Contracts on the Nasdaq 100 index fell, signaling more pain for tech stocks caught on the losing end of a rotation into cyclical re-opening trades Wednesday. Futures on the S&P 500 Index and Dow Jones Industrial Average also slipped.
In the premarket, Nike Inc. lost 4% as the company risked a boycott in China over its practice of not sourcing cotton from the contentious Xinjiang region.
West Texas Intermediate crude fell below $60 a barrel, after adding almost 6% Wednesday. Tugs and diggers are trying to dislodge the ship stuck for a third day in the Suez Canal, a critical waterway for trade.
Attention is also turning to Thursday’s seven-year Treasury auction to gauge the direction of bond yields, as poor demand for this maturity at last month’s sale helped trigger a global selloff in government debt and interest-rate sensitive stocks. U.S. benchmark 10-year yields were steady around 1.6%.
In Congressional testimony Wednesday, Powell and Treasury Secretary Janet Yellen balanced their positive assessments of the recovery with reminders that it still has a long way to go.
In Europe, concern over lockdown extensions and vaccine hiccups is keeping cyclical stocks on the back foot, with energy firms and banks among the biggest contributors to the slight loss on the Stoxx Europe 600 index.
Meanwhile, the U.S. Securities and Exchange Commission has started an inquiry into the the blank-check company frenzy that’s gripping Wall Street, according to a report. Elsewhere, Bitcoin fell as much as 4.7%, to the lowest in about two weeks. The fifth-day decline in the cryptocurrency is its longest stretch this year.
These are some key events to watch this week:
The U.S. Treasury auctions seven-year debt.U.S. personal income and spending data on Friday.
These are some of the main moves in financial markets:
Futures on the S&P 500 Index dipped 0.3% as of 7:51 a.m. New York time.The Stoxx Europe 600 Index fell 0.7%.The MSCI Asia Pacific Index climbed 0.2%.The MSCI Emerging Market Index declined 0.5%.
The Bloomberg Dollar Spot Index was little changed.The euro was little changed at $1.1809.The British pound gained 0.2% to $1.3707.The onshore yuan weakened 0.3% to 6.542 per dollar.The Japanese yen weakened 0.3% to 109.09 per dollar.
The yield on 10-year Treasuries decreased less than one basis point to 1.61%.The yield on two-year Treasuries dipped less than one basis point to 0.14%.Germany’s 10-year yield fell two basis points to -0.37%.Britain’s 10-year yield sank three basis points to 0.728%.Japan’s 10-year yield gained one basis point to 0.086%.
West Texas Intermediate crude fell 2.4% to $59.73 a barrel.Brent crude dipped 2% to $63.11 a barrel.Gold weakened 0.3% to $1,729.54 an ounce.
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