Europe Stocks Drop While U.S. Futures Fluctuate: Markets Wrap


(Bloomberg) — Stocks slid while U.S. equity futures fluctuated on Thursday as investors awaited the latest American jobless data after another steep sell-off on Wall Street. Treasuries gained alongside the yen.

The Stoxx Europe 600 Index fell, with travel and auto shares among the biggest laggards. Contracts on the main U.S. equity benchmarks swung from losses to gains in the wake of a gloomier outlook from Goldman Sachs Group Inc. on the American labor market and amid warnings from the Federal Reserve about a lasting downturn. Cisco Systems Inc. gave a sales forecast that beat analyst expectations, sending shares higher after the Wall Street close.

Asian equities declined, with Japan and Australia suffering some of the steepest falls. Crude oil ticked up, recovering from Wednesday’s drop.

The rally in global equities from March lows is showing further signs of stalling this week amid suggestions from some big-name investors that stocks have run up too far amid the economic uncertainty. Fed Chairman Jerome Powell suggested that additional fiscal support could be needed to combat the effects of the pandemic. On that score, Republicans rejected a $3 trillion stimulus measure drafted by House Democrats, but the draft plan has the seeds for an eventual, smaller compromise.

“Views are beginning to firm that the 2020 bear-market rally may have run its course,” said Matthew Sherwood, head of investment strategy for multi-asset at Perpetual Investment Management Ltd.

Elsewhere, the Australian dollar fell after data showed a record plunge of over half a million jobs in April.

Here are some key events coming up:

U.S. weekly jobless claims data are due Thursday.China on Friday releases industrial production and retail sales data for April.

These are some of the main moves in markets:

Stocks

Futures on the S&P 500 Index decreased 0.1% as of 9:21 a.m. London time.The Stoxx Europe 600 Index fell 1.6%.The MSCI Asia Pacific Index fell 1.4%.The MSCI Emerging Market Index fell 1%.

Currencies

The Bloomberg Dollar Spot Index gained 0.1%.The euro was little changed at $1.0815.The British pound fell 0.2% to $1.2213.The onshore yuan weakened 0.1% to 7.096 per dollar.The Japanese yen strengthened 0.2% to 106.81 per dollar.

Bonds

The yield on 10-year Treasuries fell four basis points to 0.62%.The yield on two-year Treasuries dipped less than one basis point to 0.16%.Germany’s 10-year yield fell one basis point to -0.54%.Britain’s 10-year yield declined less than one basis point to 0.204%.Japan’s 10-year yield decreased less than one basis point to -0.002%.

Commodities

West Texas Intermediate crude gained 3% to $26.04 a barrel.Brent crude increased 2.7% to $29.97 a barrel.Gold was little changed at $1,716.94 an ounce.

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