Tech Leads Drop in US Futures Before Economic Data: Markets Wrap

(Bloomberg) — US equity futures pointed to a weaker opening on Wall Street as traders brace for a slew of economic data that will help determine the path of monetary policy.

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Contracts on the tech-heavy Nasdaq 100 fell 0.5%. Nvidia Corp., the stock that’s led a rally across chipmakers in the frenzy over artificial intelligence, slipped as much as 2.1% in premarket. S&P 500 futures dropped 0.4%. In Europe, the Stoxx 600 index edged lower as investors digested the latest earnings. ASM International NV dropped after the chip-equipment maker’s disappointing revenue forecast.

Aside from earnings, attention is on US GDP and inflation numbers and a strong line-up of central bank speakers. Investors are contending with an erosion in expectations for how much the Federal Reserve and European Central Bank will lower rates.

“In December, markets priced sizeable rate cuts in 2024, but what’s happened is we have had slightly problematic inflation prints in most parts of the world,” said Guy Miller, chief market strategist at Zurich Insurance Co. “The US economy has done better than what many people expected, the labor market remains tight and wage gains have been higher than what central bankers are comfortable with.”

Markets have been moving to price only 75 basis points of US easing by year-end, in line with what Fed policymakers in December indicated is the likeliest outcome. Treasury yields dipped Wednesday, while a gauge of the dollar strengthened to the highest since Feb. 20.

Cryptocurrency-linked stocks gained as Bitcoin advanced for a fifth day, on track for its biggest monthly increased since October 2021. The launch of spot Bitcoin exchange-traded funds in the US in early January has driven a frenzy of buying, overcoming concerns the Fed won’t cut rates as quickly as hoped. Bitcoin climbed above $59,000 Wednesday, up 39% in the month.

Elsewhere, the New Zealand dollar slid more than 1% after the Reserve Bank of New Zealand delivered less hawkish comments on inflation, citing how most measures of price expectations have fallen.

Equity benchmarks in Hong Kong slumped more than 1% as the city’s budget report failed to impress investors. Chinese stocks fell after a recent rally took gauges to resistance levels, with traders looking to this week’s manufacturing report and a key political meeting in Beijing next week for momentum.

Oil fell after a two-day gain as signs of higher US inventories vied with expectations that OPEC+ will extend supply cuts. Iron ore resumed its slide, as investors remained undecided about the strength of China’s demand for steel ahead of the nation’s usual peak construction season.

Meanwhile, Nigeria’s naira weakened to a fresh low after a much-bigger-than-expected 400 basis point interest rate increase by the central bank on Tuesday failed to support the currency. The naira has been sapped by a local scarcity of dollars and an outstanding backlog of demand for the greenback.

Key Events This Week:

  • Eurozone economic confidence, consumer confidence, Wednesday

  • US wholesale inventories, GDP, Wednesday

  • Fed’s Raphael Bostic, Susan Collins and John Williams speak, Wednesday

  • G-20 finance ministers and central bank chiefs meet in Sao Paulo, Wednesday through Thursday

  • Germany CPI, unemployment, Thursday

  • US consumer income, PCE deflator, initial jobless claims, Thursday

  • Fed’s Austan Goolsbee, Raphael Bostic and Loretta Mester speak, Thursday

  • China official PMI, Caixin manufacturing PMI, Friday

  • Eurozone S&P Global Manufacturing PMI, CPI, unemployment, Friday

  • BOE chief economist Huw Pill speaks, Friday

  • US construction spending, ISM Manufacturing, University of Michigan consumer sentiment, Friday

  • Fed’s Raphael Bostic and Mary Daly speak, Friday

Some of the main moves in markets:


  • S&P 500 futures fell 0.4% as of 5:54 a.m. New York time

  • Nasdaq 100 futures fell 0.5%

  • Futures on the Dow Jones Industrial Average fell 0.3%

  • The Stoxx Europe 600 fell 0.2%

  • The MSCI World index fell 0.2%


  • The Bloomberg Dollar Spot Index rose 0.2%

  • The euro fell 0.3% to $1.0815

  • The British pound fell 0.3% to $1.2650

  • The Japanese yen was little changed at 150.66 per dollar


  • Bitcoin rose 4.5% to $59,264.81

  • Ether rose 3% to $3,346.94


  • The yield on 10-year Treasuries declined one basis point to 4.29%

  • Germany’s 10-year yield declined one basis point to 2.45%

  • Britain’s 10-year yield was little changed at 4.20%


  • West Texas Intermediate crude fell 1.1% to $78.03 a barrel

  • Spot gold fell 0.2% to $2,027.12 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Winnie Hsu and Robert Brand.

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