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US stock futures edge lower as dollar declines

Jan 11 2019 16:12
Eddie van der Walt, Bloomberg

US stock futures slipped with European shares on Friday, while Asian equities rose at the end of a week when sentiment was mostly bolstered by a dovish tone from the Federal Reserve and hopes for a breakthrough on trade.

The dollar fell and Treasuries advanced.

Contracts on the S&P, Dow and Nasdaq indexes all pointed to a softer open in New York, while the Stoxx Europe 600 Index handed back an earlier gain.

In Asia, shares rose in Shanghai, Tokyo, Seoul and Hong Kong. The greenback was set for a fourth week of losses after Fed Chairman Jerome Powell underscored the message of patience with further interest-rate hikes, while saying the central bank will keep shrinking its balance sheet.

US price data showed inflation slowing in line with expectations. European debt tracked Treasuries higher. The pound advanced even as Prime Minister Theresa May’s office countered reports that Brexit may be delayed.

Equities are still set for big gains this week amid signs of progress between the world’s two biggest economies on trade and dovish commentary from the Fed.

Nevertheless, worries remain about economic growth and earnings prospects, while there’s also uncertainty as the US partial government shutdown threatens to extend into a fourth week.

Chinese Vice Premier Liu He is set to visit Washington on January 30 and 31 for further trade talks.

China’s yuan, which slumped last year as trade tensions worsened, is heading for its best week since 2005 – back when the country dropped a fixed peg to the dollar.

Elsewhere, oil in New York dropped toward $52 a barrel after surging this week. Emerging-market shares climbed.

These are the main moves in markets:

Stocks

Futures on the S&P 500 Index declined 0.3%  as of 08:31 New York time, the first retreat in more than a week.

The Stoxx Europe 600 Index dipped 0.1%. The MSCI All-Country World Index climbed 0.1%, hitting the highest in more than four weeks with its sixth consecutive advance.

The MSCI Emerging Market Index advanced 0.3% to the highest in more than five weeks.

Currencies

The Bloomberg Dollar Spot Index sank 0.3% to the lowest in more than 15 weeks.

The euro gained 0.3% to $1.153. The Japanese yen increased 0.1% to 108.31 per dollar.

The British pound jumped 0.5% to $1.2817, the strongest in more than six weeks.

The MSCI Emerging Markets Currency Index climbed 0.1% to the highest in almost seven months.

Bonds

The yield on 10-year Treasuries fell three basis points to 2.71%, the biggest fall in more than a week.

Germany’s 10-year yield decreased one basis point to 0.24%. Britain’s 10-year yield increased one basis point to 1.289%, the highest in more than two weeks.

The spread of Italy’s 10-year bonds over Germany’s fell three basis points to 2.6008 percentage points.

Commodities

The Bloomberg Commodity Index increased 0.4%. West Texas Intermediate crude fell 0.5% to $52.34 a barrel, the first retreat in more than two weeks. LME copper climbed 0.4% to $5 953.50 per metric ton.

Gold gained 0.5% to $1 292.52 an ounce.

equities  |  markets  |  oil  |  brexit  |  asian markets  |  stocks
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