Breaking News
Black Friday SALE: Up to 54% off InvestingPro! Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Opening Bell: China Woes Pressure U.S. Futures, Stocks; Dollar, Yields Rally

By Investing.com (Pinchas Cohen/Investing.com)Market OverviewOct 18, 2021 09:00AM ET
www.investing.com/analysis/opening-bell-china-woes-pressure-us-futures-stocks-dollar-yields-rally-200605364
Opening Bell: China Woes Pressure U.S. Futures, Stocks; Dollar, Yields Rally
By Investing.com (Pinchas Cohen/Investing.com)   |  Oct 18, 2021 09:00AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
  • Colliding market themes continue
  • Bitcoin rallies as first US ETF due to start trading
  • Gold slides

Key Events

Disappointing growth figures from China as well as soaring energy prices globally reinforced concerns about inflation and drove US futures on the Dow, S&P, NASDAQ and Russell 2000 as well as European stocks lower in trading on Monday.

Oil rallied along with energy sector.

Global Financial Affairs

NASDAQ 100 and Russell 2000 futures outperformed contracts on the S&P 500 and the Dow Jones this morning, which is confusing for many reasons.

First, if investors are concerned about inflation, why are small caps outperforming? If the economy doesn't reopen due to the coronavirus, smaller domestic firms will suffer.

Second, why are tech contracts outperforming? Will rising interest rates allow borrowers to sustain record stock market highs?

Finally, why are the Russell and NASDAQ leading the advance when they are meant to represent two contradictory views about the fate of the economy?

We're seeing this as another example of a lack of market coherence, indicating rather clearly that the market does not always behave rationally.

It is worth noting that today's futures selloff comes on the heels of the best week for the S&P 500 since July.

In Europe the STOXX 600 also opened lower, dragged down by the consumer discretionary and retail sectors, as soaring commodity costs intensified the energy crisis. Miners and oil and gas providers were the bright spots, as they actually benefited from the spike in their underlying commodities.

Stocks in Asia were weighed down by data out of China, revealing the world’s second-largest economy grew at the slowest rate in a year during the third quarter, due to power shortages, supply chain disruptions and panic in the property market amid a regulatory crackdown on highly leveraged investments.

China’s GDP slowed to 4.9% YoY, missing the 5.2% estimates. Industrial production expanded by 3.1%, well below the 4.5% expected. Still, China’s Shanghai Composite declined by just 0.1%, and Hong Kong’s Hang Seng was 0.3% higher. But the FTSE China A50 tumbled 2.2%.

Yields on the 10-year Treasury note were boosted by inflationary fears that had investors hiding their money in bonds.

UST 10Y Daily
UST 10Y Daily

Rates are aiming to provide an upside breakout of a massive H&S bottom.

The dollar opened higher, tracking the gain in yields.

Dollar Index Daily
Dollar Index Daily

The greenback has been fluctuating for the past three weeks after completing a large double bottom. Will it extend the currency's uptrend, after establishing a major bottom?

Gold fell on the rise in yields and dollar strength. Precious metals are struggling as markets expect the Federal Reserve to start tapering in November.

Gold Daily
Gold Daily

The yellow metal may have completed a weekly H&S continuation pattern, which means it may continue along its downtrend.

Bitcoin opened higher as the first Bitcoin Futures ETF, the Bitcoin Strategy ETF (BITO), is due to start trading this week.

Bitcoin Daily
Bitcoin Daily

The cryptocurrency will battle between the bullishness of breaking higher than its rising channel and the presumed resistance of the April; record peak. The outlook for BTC remains a contentious issue in markets with some experts forecasting its ultimate demise even as others believe the crypto asset class is only heading higher.

Oil built on its eight-weekly advance, rising to its highest level since 2014. WTI gained for the third straight day, heading toward $83.

Up Ahead

Market Moves

Stocks

  • The STOXX 600 fell 0.5%
  • Futures on the S&P 500 fell 0.3%
  • Futures on the NASDAQ 100 fell 0.5%
  • Futures on the Dow Jones Industrial Average fell 0.3%
  • The MSCI Asia Pacific Index rose 1.3%
  • The MSCI Emerging Markets Index rose 1.3%

Currencies

  • The Dollar Spot Index rose 0.2%
  • The euro fell 0.2% to $1.1579
  • The Japanese yen fell 0.1% to 114.37 per dollar
  • The offshore yuan was little changed at 6.4338 per dollar
  • The British pound was little changed at $1.3741

Bonds

  • The yield on 10-year Treasuries advanced four basis points to 1.61%
  • Germany’s 10-year yield advanced two basis points to -0.14%
  • Britain’s 10-year yield advanced two basis points to 1.13%

Commodities

Opening Bell: China Woes Pressure U.S. Futures, Stocks; Dollar, Yields Rally
 

Related Articles

Jeffrey Halley
B.1.1.529 Infects Asian Markets By Jeffrey Halley - Nov 26, 2021 1

Asian stock markets were under heavy selling pressure with investors spooked by the emergence of a heavily mutated variant of Covid-19 in South Africa, lovingly called...

Opening Bell: China Woes Pressure U.S. Futures, Stocks; Dollar, Yields Rally

Add a Comment

Comment Guidelines

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.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (10)
Goddey Joshua
Goddey Joshua Oct 27, 2021 5:46AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
please Sir, can you tell me how I can benefit from here
Chukwu Boy Chioma
Chukwu Boy Chioma Oct 18, 2021 2:22PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
how can somebody make money from here
Rick Miller
Rick Miller Oct 18, 2021 9:10AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Do you REALLY want to KNOW why the "confusing" instances occur?..It's simple..it means a significant volume of money has been put into them in a certain direction and the market moves against it to take it. Also they see a strategic way to trap more money in and around the same level so they don't get stuck with too much money all over the place.
Pinchas Cohen
Pinchas Cohen Oct 18, 2021 9:10AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Thank you for teaching me, Rick.
jerryjovi Mar
jerryjovi Mar Oct 18, 2021 8:02AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
I don't want help, I wish I could work and return
Zinzi Siswana
Zinzi Siswana Oct 18, 2021 8:01AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Gold must go up so that i can make a profitAt least 1830
marcus daily
marcus daily Oct 18, 2021 7:58AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Love how they say, economic problems due to the pandemic when it really is a liberal/democratic priblem. Liberals un california raising havic in yhe shipping ports with stupid liberal regulations. And the i going stupidity of the cushy unemployment benefits.
Md Ikramul Hossen Comedy Channel
Md Ikramul Hossen Comedy Channel Oct 18, 2021 7:49AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
plrass help me
Habtamu Tadele
Habtamu Tadele Oct 18, 2021 7:43AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
please help me
Don Casty
Don Casty Oct 18, 2021 7:43AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
bring account i manage for u
Bright Sarfo
Bright Sarfo Oct 18, 2021 7:38AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
I like to be your friend.
Gershom Zvi
Gershom Zvi Oct 18, 2021 7:03AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Disappointing growth figures from Communist China and Xi economy !? Ha ha ha
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

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.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
or
Sign up with Email