Stocks, futures fall before Trump talks about China: markets wrap

(Bloomberg) – Shares fell with US futures on Friday as President Donald Trump’s scheduled press conference on China threatened to further intensify tensions between the world’s two largest economies. Treasuries won alongside most European bonds.

The Stoxx 600 Index fell for the first time in five days, pulling downward shares of travel and automakers as deteriorating Sino-US relations clouded a global stock rally triggered by the reopening of economies. Contracts for key US stock benchmarks declined after Trump told reporters that he would announce what the government would do “with respect to China” after Beijing tried to pass a law that would Could limit freedoms in Hong Kong. The White House did not immediately indicate a time.

Shares in Shanghai were little changed, while the offshore yuan remained stable. Hong Kong stocks were among the largest declines in the region. Crude oil cut its largest monthly rise in existence, while the dollar weakened for a second day in a row. Gold rose higher.

Global stocks have largely shaken the escalating tensions between Washington and Beijing, but Trump’s scheduled press conference appears to have scared investors. This is happening amidst growing good news on the economic front, as governments give additional impetus after the corona virus and facilitate lockdown measures. Meanwhile, hints on the next stages of Federal Reserve policy could come on Friday when Chairman Jerome Powell takes part in a virtual discussion.

“I am very careful about my medium and even long-term prospects for the markets,” said Kate Jaquet, portfolio manager at Seafarer Capital Partners LLC, at Bloomberg TV. “I see a very large discrepancy between the global stock market valuations and the underlying corporate fundamentals.”

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Here are some key events:

The euro area data due on Friday shows that consumer inflation fell from 0.4% in May to 0.1% in May. Trump is expected to hold a press conference on Friday to discuss steps related to China. Powerell is participating in a question-and-answer discussion on Friday.

These are some of the key steps in the markets:

Stocks

S&P 500 index futures fell 0.7% at 9:22 p.m. London time. The Stoxx Europe 600 index fell 1.2%. The MSCI Asia Pacific Index fell 0.3%. The MSCI Emerging Market Index rose 0.1%.

Currencies

The Bloomberg Dollar Spot Index declined 0.1%. The euro rose 0.2% to USD 1.1096. The British pound fell 0.1% to USD 1.2305. The onshore yuan barely changed at $ 7.147 per dollar. The Japanese yen rose 0.4% to $ 107.23 per dollar.

tie up

The yield on 10-year government bonds fell three basis points to 0.66%. The yield on two-year government bonds declined by one basis point to 0.16%. Germany’s 10-year yield declined by two basis points to -0.44%. Britain’s 10-year return declined two basis points to 0.189%. Japan’s 10-year yield rose less than one basis point to 0.005%.

raw materials

West Texas Intermediate Crude Oil fell 3% to $ 32.69 a barrel. Brent crude fell 2.5% to $ 34.42 a barrel. Gold rose 0.3% to $ 1,722.74 an ounce.

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