Please try another search
Futures on the S&P 500, Dow and NASDAQ 100 stood squarely in the red this morning, pointing to a lower post-U.S. holiday open as global growth concerns, stalling trade negotiations and Brexit fears continued weighing on market sentiment.
Ten-year Treasurys edged higher alongside gold and the yen, even against a strengthening Dollar Index.
Gold in specific benefited from traders offloading risk after prices neared their uptrend line since November 13—but later reversed its course and slipped lower.
European shares on the STOXX 600 dropped, though slightly paring a heftier decline, after Swiss bank UBS (SIX:UBSG) lost 4.4 percent on disappointing earnings. The company's quarterly results took a hit from wealth management clients closing accounts in a volatile market.
The broader outlook for European as well as global growth has deteriorated: the International Monetary Fund cut its forecast for 2019 growth to 3.5 percent from 3.7 percent, while it revised forecast for 2020 to 3.6 percent from 3.7 percent. European market players took the IMF revision especially hard, as the agency cited weakness in the German auto industry—the heart of Europe’s economic growth—as a key driver, as well as the U.S.-Sino trade dispute.
Meanwhile in the UK, lawmakers are tabling amendments to Prime Minister Theresa May's Brexit draft. The British PM noted that she would keep seeking further concessions from the EU on the Irish border—which has become one of the main stumbling blocks in the negotiations—ahead of the paramount March 29 deadline.
Short-term pound bulls are fighting medium-term bears, as the chart illustrates. Sterling's rebound since December is testing the top of the downtrend line since May.
During the previous Asian session, regional indices took a beating as China’s official economic growth index showed a 6.6 percent drop for 2018, marking the slowest growth pace since 1990 and thereby exacerbating investor fears.
In the U.S., Friday's session saw equities seal a fourth straight daily gain, capping the fourth straight weekly advance. Several factors fueled optimism, including Chinese vows to increase imports and better-than-expected earnings results for major U.S. banks. This included higher expectations for forward growth, which helped easing market worries after companies had posted softer guidance at the end of last year.
Conversely, sentiment soured on the trade-talks front amid a perceived lack of progress on technology copy rights—a key issue within U.S.-China negotiations. Adding fuel to the fire, U.S. President Donald Trump tweeted: “China posts slowest economic numbers since 1990 due to U.S. trade tensions and new policies. Makes so much sense for China to finally do a Real Deal and stop playing around!"
Based on recent reports, analysts and fund managers have increasingly turned pessimistic, reflecting the market's low appetite for risk. Ajay Kapur, head of Asia-Pacific and global emerging market strategy at Bank of America Merrill Lynch), told Bloomberg TV:
“Most of the time, when you buy when sentiment is this depressed, you tend to make money; unless there’s a recession.”
Investors are facing a deepening divergence between tailwinds—of trade-war resolution prospects and company growth—and headwinds—of persistent trade negotiation jitters and weakening global growth. Is this the end of the bull market? We believe the coming weeks may give us the answer. Should the S&P 500 2,700 levels hold resistance, as we tend to believe, then the December lows will be tested. That’s where the downtrend line from the September record peak, October-December range and major moving averages is situated.
Stocks
Currencies
Bonds
Commodities
Looking at the weekly close of the 10-year US Treasury yield, the final yield print this week at 4.30% is the highest weekly closing yield since the 4.47% close in late November...
A rate cut is unlikely for the Reserve Bank of Australia because inflation is still higher than the 2–3% target range. Further RBA decisions are unpredictable—the market awaits the...
Market Overview: S&P 500 Emini FuturesOn the weekly chart, the market has been stalling in the last 3 weeks by trading sideways and S&P 500 Emini is forming an Emini ioi breakout...
Are you sure you want to block %USER_NAME%?
By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.
%USER_NAME% was successfully added to your Block List
Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.
I feel that this comment is:
Thank You!
Your report has been sent to our moderators for review
Add a Comment
We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:
Enrich the conversation, don’t trash it.
Stay focused and on track. Only post material that’s relevant to the topic being discussed.
Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.
Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.