Stocks climb with focus on inflation: Markets wrap

(Bloomberg) — Stocks rose as markets reopened in Europe and the U.S., with traders expecting inflation prints and central bank speakers to hint at the timing of interest rate cuts.

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US stock futures rose 0.3%, led by Apple Inc. Helped by pre-market gains in China, it added 1.8% after China exports rebounded. Europe’s Stoxx 600 was little changed, gaining 3.5% in May.

Treasuries posted little moves ahead of short-term auctions on Tuesday, including offerings of two-year and five-year notes. Brent crude was flat – even as tensions in the Middle East rose.

Nvidia Corp. Earnings strength at tech megacaps like that helped stocks erase April’s slide, as U.S. data and cautious fedspeak cool markets betting on an intention to ease policy this year.

Traders will focus on the PCE deflator, the Fed’s preferred inflation measure, on Friday. The ECB’s Class Knott speaks on Tuesday, with Lisa Cook and Neel Kashkari among the Fed speakers this week.

“We’re very much on the inflation data watch right now,” said Marija Weidmane, senior multi-asset strategist at State Street Global Markets. Large-cap growth stocks will be at the forefront.

Consumer inflation expectations in the euro zone fell in April, ECB data showed, as policymakers next meet on rates on June 6. On Monday, France’s Francois Villeroy de Galhau said the ECB should not rule out rate cuts in both June and July. Hawkish policymakers, including board member Isabelle Schnabel, recently came out against the back-to-back moves.

T+1 focus

As traders return from the long weekend, they are wary of issues related to the switch to the “T+1” rule — which would see U.S. stocks settle in one day instead of two.

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There are concerns about potential leverage issues, including that international investors may struggle to access dollars on time, that global funds will move to their assets at different speeds, and that everyone will have less time to correct errors.

Wall Street returns to T+1 stock trading after a century

Elsewhere, the merchants failed Mt. Bitcoin tumbled as it tracked transactions through wallets belonging to the Gox exchange, whose executives stepped up efforts to return the massive digital asset worth $9 billion to creditors.

Some of the key events this week:

  • The IMF is holding discussions with Ukrainian officials to review economic policies as the country seeks to unlock $2.2 billion in aid on Monday.

  • Cleveland Fed President Loretta Mester Speaks at BOJ Event in Tokyo; Minneapolis Fed President Neel Kashkari and ECB Governing Council member Klaus Knott address the Barclays-CEPR International Monetary Policy Forum on Tuesday.

  • South Africa’s election on Wednesday is the most important since the end of apartheid

  • The Fed releases the Page Book economic survey on Wednesday

  • South Africa rate decision, US initial jobless claims, GDP, total inventories, Thursday

  • New York Fed President John Williams speaks at the Economic Club of New York on Thursday

  • Canada, Eurozone, Turkey GDP data released on Friday

  • Japan Unemployment, Tokyo CPI, Industrial Production, Retail Sales, Friday

Some key movements in the markets:

Shares

  • The Stoxx Europe 600 was little changed as of 10:54 a.m. London time

  • S&P 500 futures rose 0.3%

  • Nasdaq 100 futures rose 0.5%

  • The future of the Dow Jones Industrial Average was little changed

  • The MSCI Asia Pacific Index was little changed

  • The MSCI emerging market index fell 0.2%

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Coins

  • The Bloomberg Dollar Spot Index was little changed

  • The euro rose 0.2% to $1.0877

  • The Japanese yen was little changed at 156.94 per dollar

  • The offshore yuan was little changed at 7.2641 per dollar

  • The British pound was little changed at $1.2773

Cryptocurrencies

  • Bitcoin fell 1.8% to $68,304.63

  • Ether fell 0.2% to $3,880.04

Bonds

  • The yield on 10-year Treasuries was little changed at 4.46%.

  • Germany’s 10-year yield rose one basis point to 2.56%

  • Britain’s 10-year yield fell three basis points to 4.23%.

goods

  • Brent crude was up 0.3% at $83.31 a barrel

  • Spot gold was down 0.3% at $2,344.41 an ounce

This story was produced with the help of Bloomberg Automation.

–With assistance from Huyeon Kim, Ruth Carson, Aya Wakatsuma, Jason Scott, and Naomi Tajitsu.

(The third column fixes the auction time.)

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