Shares fell along with the future of the US and Europe on Tuesday due to concerns about the timing of President Joe Biden’s tax relief plan and warnings of potential asset bubbles. The dollar extended an advance.
A range of Asia-Pacific stocks slipped the most in about two months. Hong Kong performed poorly, dragged down by a decline in Tencent Holdings Ltd. after the market value of the internet giant rose to its peak $ 1 trillion for the first time Monday. In China, shares fell after the central bank withdrew cash from the banking system and an official warned about asset bubbles.
S&P 500 futures slipped after comments from Senate Majority Leader Chuck Schumer that a the aid package is unlikely before mid-March. Nasdaq 100 contracts fell ahead of earnings from some of the largest technology companies. Treasuries rose overnight and oil fluctuated below $ 53 a barrel.
Global stocks have retreated from a record as investors look for fresh catalysts to push them higher or at least to justify current valuations. This could come from a list of earnings reports that will be sent out this week. Meanwhile, the possibility of a US tax exemption package being delayed is a key reason why Treasury yields rose earlier this year.
“If financial markets needed any further confirmation that the US fiscal stimulus was the only game in town, the buying flock received it overnight,” wrote Jeffrey Halley, senior market analyst at Oanda Asia Pacific Pte. -a note. Concern from Republicans in the Senate about the size of the planned package “was enough to remove shares from their highs during the day,” sent bond yields lower and boosted demand for the dollar, he said.
President Joe Biden has said he is open to negotiations on his $ 1.9 trillion aid proposal for Covid-19 and hopes to bring Republicans behind it, although he has not ruled out pursuing a route just for Democrats. Schumer said earlier Monday that he intends to secure the next round of aid until mid-March, when the benefits for the last package will run out.
On the pandemic front, vaccine coverage will not reach a point that will stop the transmission of the virus in the foreseeable future, the World Health Organization. The American head of infectious diseases, Anthony Fauci, said he was worried about delays until the second dose.
Here are some key events that will appear next week:
- Microsoft Corp., Apple., Tesla Inc., Facebook Inc. and Samsung Electronics Co. is among the companies that report results.
- US housing price data and consumer confidence come on Tuesday.
- The Federal Open Market Committee’s monetary policy decision and briefing by President Jerome Powell are scheduled for Wednesday.
- Fourth-quarter GDP, initial unemployment claims and new home sales are among US data releases on Thursday.
- US personal income, expenses and pending home sales come Friday.
These are the main movements in the markets:
Inventories
- The S&P 500 futures fell 0.6% since 7:12 in London. The S&P 500 index rose 0.4%.
- Japan’s Topix index fell 0.8%.
- The Kospi index in South Korea fell 2.1%.
- Hong Kong’s Hang Seng Index fell 2.4%.
- The Shanghai Composite Index fell 1.5%.
- Euro Stoxx 50 futures fell 0.2%.
currencies
- The Bloomberg Dollar Spot index added 0.2%.
- The euro fell 0.1% to $ 1.2127.
- The pound fell 0.3% to $ 1.3641.
- The Japanese yen was slightly unchanged at 103.74 per dollar.
- The offshore yuan was steady at $ 6.4866.
BONDS
- The 10-year Treasury yield remained at 1.03%.
commodities
- West Texas Intermediate Oil fell 0.5% to $ 52.50 a barrel.
- Gold was steady at $ 1,855 an ounce.
– With the assistance of Vivien Lou Chen, Katherine Greifeld and Joanna Ossinger