US Futures Slip; Stocks May Get Hong Kong Boost: Markets Wrap – EMEA TRIBUNE

(Bloomberg) — U.S. equity futures edged lower Monday as traders weighed the risk of stiffer sanctions on Russia. Asian stocks may get a boost from Beijing’s move to ease a dispute that imperils the U.S. listings of Chinese firms.

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Contracts earlier rose for Hong Kong, where Chinese technology shares could get a tailwind after regulators removed a key hurdle that impedes full U.S. access to audits. Contracts for Japan and Australia pointed to steady starts.

The dollar was firm as investors evaluated a push by some European Union governments for new penalties on Russia following reports that its troops executed unarmed civilians in Ukrainian towns.

Crude oil fell, extending a decline sparked by a U.S. announcement of an unprecedented release of strategic reserves to fight elevated energy costs.

The U.S. Treasury yield curve is flashing more warnings that economic growth will slow as the Federal Reserve hikes interest rates to tame inflation stoked in part by commodities. The two-year U.S. yield has exceeded the 30-year rate for the first time since 2007, joining inversions on other parts of the curve.

The Fed minutes later this week will shape views on the odds of a half percentage-point rate increase in May and provide key details on how the central bank will shrink its balance sheet.

“It would not be surprising to see yields rise further from here and it is very hard to know where they will land,” Angela Ashton, founder and director of investment consulting firm Evergreen Consultants, wrote in a note. “Markets are volatile and there is every chance they will overshoot.”

New York Fed President John Williams said Saturday a “sequence of steps” can get rates back to more normal levels. Mary Daly, president of the San Francisco Fed, said in an interview published Sunday that rising inflation and a tight labor market strengthen the case for a half-point May hike.

A strong jobs report Friday bolstered the case for the Fed to push up borrowing costs. The U.S. added 431,000 jobs in March while the unemployment rate fell to 3.6%, near its pre-pandemic low.

In China, where markets are closed for a holiday, most of Shanghai’s 25 million residents are under some form of Covid lockdown. State media also reported a new subtype of the omicron variant.

Some of the main moves in markets:

Stocks

  • S&P 500 futures fell 0.1% as of 7:51 a.m. in Tokyo. The S&P 500 rose 0.3%

  • Nasdaq 100 futures declined 0.2%. The Nasdaq 100 rose 0.2%

  • Nikkei 225 futures were little changed

  • Australia’s S&P/ASX 200 Index futures rose 0.2%

  • Hang Seng Index futures rose 0.7%

Currencies

Bonds

Commodities

  • West Texas Intermediate crude fell 0.6% to $98.67 a barrel

  • Gold was at $1,923.27 an ounce

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