Stocks drop, treasuries advance before Powell

London - European shares dropped after sharp declines in the US and Asia. Treasuries rose as traders awaited a second appearance from Federal Reserve chairperson Jerome Powell, whose comments riled markets earlier this week.

Retailers and media companies were among the biggest losers in the Stocks Europe 600 Index, while S&P 500 Index futures were little changed. Treasuries climbed with German bunds, with the yield on 10-year US notes falling 2 basis points toward 2.8%.

Spot gold headed for the lowest close this year and West Texas Intermediate crude was set for the first advance in three days. The dollar edged higher.

Market participants will keep a close eye on Powell’s second day of testimony after he painted an upbeat picture of the US economy on Tuesday. His comments opened the door to speculation the central bank plans to quicken the pace of monetary tightening, a move investors like Bridgewater Associates President Ray Dalio warn could hamper growth.

Elsewhere, the UK pound edged lower after the European Union published a draft Brexit treaty, squaring off with Prime Minister Theresa May. The Australian dollar dropped after business investment unexpectedly fell in the final three months of last year. Aluminum headed lower with President Donald Trump set to announce steep import tariffs on Thursday.

Here are some key events scheduled for this week:

• Fed’s Powell testifies before the Senate Banking Committee on Thursday.

• Other Fed speakers this week are Bill Dudley.

• Russian President Vladimir Putin is giving a pre-election address in Moscow.

• UK Prime Minister Theresa May delivers a speech on Friday on Britain’s relationship with the European Union.

These are the main moves in markets:

Stocks

• The Stoxx Europe 600 Index dipped 0.4% as of 10:15, the lowest in two weeks.

• The MSCI All-Country World Index decreased 0.3% to the lowest in more than two weeks.

• Futures on the S&P 500 Index declined less than 0.05% to the lowest in a week.

• The UK’s FTSE 100 Index fell 0.3% to the lowest in more than two weeks.

Currencies

• The Bloomberg Dollar Spot Index climbed 0.1% to the highest in six weeks.

• The euro declined less than 0.05% to $1.2189, the weakest in six weeks.

• The Australian dollar dipped 0.5% to 0.773 per dollar, the weakest in more than two months.

• The rand sank 0.7% to R11.88, the weakest in more than two weeks.

• The British pound decreased 0.1% to $1.3745, the weakest in almost seven weeks.

Bonds

• The yield on 10-year Treasuries fell two basis points to 2.84%, the lowest in more than two weeks.

• Germany’s 10-year yield decreased two basis points to 0.63%, the lowest in almost five weeks.

• Britain’s 10-year yield declined one basis point to 1.501%, the lowest in a month.

Commodities

• West Texas Intermediate crude advanced less than 0.05% to $61.66 a barrel.

• Gold decreased 0.6% to $1 310.89 an ounce, the weakest in two months.

• LME aluminum fell 0.4% to $2 122.50 per metric ton, the lowest in 10 weeks.