(Bloomberg) — European stocks were little changed and US equity futures slipped as Chinese economic data dented optimism after last week’s global share-market rally.
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The Stoxx 600 index fell less than 0.1%, while Nasdaq futures retreated 0.2%, following Asian stocks lower. Treasury 10-year yields climbed as much as five basis points to 4.51%, the highest in more than a week. The dollar was little changed.
A slowdown in China’s industrial profit growth added to concern about deflation in the world’s second-largest economy. Fresh economic data this week will help traders gauge whether the gains for stocks and bonds seen so far this month can extend into December. Statistics include euro-zone inflation figures, China PMIs and US personal consumption numbers on Thursday, and US and euro-area PMIs on Friday.
“We’ve seen US bond yields gap higher at the open, and that has weighed on equity market sentiment to send US futures down alongside Chinese markets that are already under pressure from weak industrial profits,” said Matt Simpson, a senior market strategist at City Index Inc.
Read More: November Equity Rally Could Face December Bumps: Taking Stock
The cautious start comes despite the VIX index, known as Wall Street’s “fear gauge,” falling last week to its lowest level since January 2020. Markets have been buoyed by a growing assumption that further interest-rate hikes from the Federal Reserve and European Central Bank are unlikely.
In earnings due this week, Crowdstrike Holdings Inc. will underscore how businesses are prioritizing cybersecurity after recent high-profile corporate hacks, while Salesforce Inc. and Dell Technologies Inc. are expected to post slower sales growth as overall corporate expenditure tightens.
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Traders will also be keeping an eye on gold and oil after Israel and Hamas signaled that a temporary cease-fire in Gaza could be extended beyond Monday to allow for the release of more hostages and prisoners. Oil fell for a fourth day as traders looked ahead to this week’s delayed OPEC+ meeting.
In Asia, the subdued growth at Chinese industrial companies may keep firms cautious about expanding or hiring more, which in turn could add more pressure on prices.
The Hang Seng China Enterprises Index slipped as much as 1.4%, while the CSI 300 Index fell as much as 1.3%. The yen strengthened against all its Group-of-10 peers.
“The profit numbers show that current recovery momentum is still fairly fragile,” Dong Chen, head of Asia macroeconomic research at Pictet Wealth Management, said in an interview with Bloomberg Television. “We still have a long way to go to get out of the woods.”
Key events this week:
European Central Bank President Christine Lagarde appears in parliamentary committee, Monday
Australia retail sales, Tuesday
NATO foreign ministers meet, Tuesday
US Conf. Board consumer confidence, Tuesday
Fed Governor Chris Waller, Chicago Fed President Austan Goolsbee speak at different events, Tuesday
Australia CPI, Wednesday
Reserve Bank of New Zealand policy decision, Wednesday
Eurozone economic confidence, consumer confidence, Wednesday
Bank of England Governor Andrew Bailey speaks, Wednesday
US wholesale inventories, GDP, Wednesday
Fed releases its Beige Book of regional economic activity, Wednesday
Cleveland Fed President Loretta Mester speaks, Wednesday
China non-manufacturing and manufacturing PMIs, Thursday
Eurozone CPI, Thursday
US PCE deflator, Thursday
OPEC+ meeting, focused on finalizing output levels for 2024, Thursday
China Caixin manufacturing PMI, Friday
Eurozone manufacturing PMI, Friday
UK S&P Global/CIPS Manufacturing PMI, Friday
US construction spending, ISM Manufacturing, light vehicle sales, Friday
Fed Chair Jerome Powell, Chicago Fed President Austan Goolsbee speak at separate events, Friday
Some key moves in markets:
Stocks
The Stoxx Europe 600 was little changed as of 8:20 a.m. London time
S&P 500 futures fell 0.2%
Nasdaq 100 futures fell 0.2%
Futures on the Dow Jones Industrial Average fell 0.1%
The MSCI Asia Pacific Index fell 0.2%
The MSCI Emerging Markets Index fell 0.2%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro was little changed at $1.0945
The Japanese yen rose 0.3% to 149.02 per dollar
The offshore yuan was little changed at 7.1526 per dollar
The British pound was little changed at $1.2614
Cryptocurrencies
Bitcoin fell 0.8% to $37,342.25
Ether fell 1.4% to $2,046.05
Bonds
The yield on 10-year Treasuries was little changed at 4.47%
Germany’s 10-year yield declined two basis points to 2.63%
Britain’s 10-year yield declined three basis points to 4.26%
Commodities
Brent crude fell 0.8% to $79.91 a barrel
Spot gold rose 0.6% to $2,012.22 an ounce
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Matthew Burgess.
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