(Bloomberg) — U.S. stock futures steadied after a tech-led sell-off on Wall Street as traders await the next set of price data and earnings reports from several major banks.
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Contracts for the S&P 500 and Nasdaq 100 were little changed. The Nasdaq plunged 2.2% on Thursday after inflation data bolstered the case for a Federal Reserve interest rate cut and sparked outflows from the tech giants that have been driving the stock market bull market.
Treasury yields were flat after the 10-year note yield fell 7 basis points to 4.21% in the previous session on expectations of lower U.S. interest rates.The benchmark dollar was hovering near a five-week low after falling on Thursday by its most since May.
Despite the recent sell-off, global stocks are on track to rise for a sixth straight week, the longest gain since March, as prospects of Fed easing support overall risk sentiment. Following the U.S. inflation data, traders are fully pricing in a rate cut in September and at least two more by the end of the year.
Chicago Fed President Austan Goolsby called the CPI data “excellent” and said the report provided convincing evidence that the central bank is on track to reach its 2% target. Producer price data due later on Friday will add more detail. Investors will also be watching earnings reports from Citigroup, JPMorgan Chase and Wells Fargo.
The Stoxx Europe 600 index rose for a third straight day, but only the technology sector was lower as chipmakers such as ASML Holding NV and ASM International NA followed their U.S. peers down. Communications stocks led the gains, with Swedish network equipment maker Ericsson AB surging more than 6 percent after reporting results that beat analysts’ expectations.
Meanwhile, the yen weakened in choppy trading on Friday as the positive effects of suspected intervention by Japanese authorities and interest rate checks began to fade.
“They’ve played their cards right and they’ve intervened. They’re going to have to keep intervening to maintain their credibility,” Adarsh ​​Sinha, co-head of Asia currency and rates strategy at Bank of America Securities, said of Japan’s Finance Ministry on Bloomberg TV. “It remains a tough challenge.”
Chinese stocks traded in Hong Kong on track to hit a three-week high, buoyed by hopes of policy support from the third Central Committee meeting on the mainland, with an index of Chinese property developers rising 6.3%.
Among key Asian data, China’s trade surplus jumped to its highest level since at least 1990 in June as exports surged more than expected and imports unexpectedly fell. Other data due on Friday include Japan’s industrial production and India’s inflation rate. China’s money supply and new lending data are also likely to be released on Friday.
Oil prices rose for a third straight day on signs of strengthening demand and that the Federal Reserve may be close to a long-awaited policy shift. Gold prices fell after surging on Thursday.
Major events this week:
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University of Michigan Consumer Sentiment Index, U.S. Producer Price Index, Friday
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Citigroup, JPMorgan and Wells Fargo to report earnings on Friday
Some of the key market developments:
stock
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The Stoxx Europe 600 index was up 0.2% as of 8:17 a.m. London time.
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S&P 500 futures little changed
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Nasdaq 100 futures fell 0.2%
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Dow Jones Industrial Average futures were little changed
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The MSCI Asia Pacific index fell 0.7%.
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The MSCI Emerging Markets Index fell 0.2%.
currency
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The Bloomberg Dollar Spot Index was little changed.
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The euro was little changed at $1.0865
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The Japanese yen weakened 0.3% to 159.24 yen to the dollar.
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The offshore yuan weakened 0.1% to 7.2779 yuan per dollar.
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The British pound was little changed at 1.2914 to the dollar
Cryptocurrency
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Bitcoin fell 0.5% to $57,246.98.
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Ether fell 0.7% to $3,094.32.
Bonds
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The yield on the 10-year Treasury note was little changed at 4.22%.
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German 10-year government bond yields rose 4 basis points to 2.50%.
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UK 10-year government bond yields rose 5 basis points to 4.12%.
merchandise
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Brent crude rose 0.6% to $85.90 a barrel.
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Spot gold fell 0.5% to $2,402.75 an ounce.
This story was produced with assistance from Bloomberg Automation.
–With assistance from Charlotte Yang.
(Updated for upcoming earnings releases. An earlier version corrected a discussion of U.S. core CPI.)
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