Shares fell alongside U.S. futures on Tuesday as investors reflected on a possible delay in the projected U.S. tax relief package amid a backdrop that worries some markets will overstretch. The dollar advanced.
An Asia-Pacific equities indicator at one point fell to a two-month high, with equities in South Korea and China performing poorly. The fall of Tencent Holdings Ltd. caused Hong Kong shares to fall after the Internet giant’s market value reached the peak of $ 1 trillion for the first time Monday. The People’s Bank of China unexpectedly withdrew funds from the financial system as a assessor discussed the risk of asset bubbles in local average.
The future S&P 500 fell as Senate Majority Leader Chuck Schumer he said an aid package is unlikely to be in place by mid-March and a U.S. health official expressed concern over vaccination delays. Nasdaq 100 contracts also pointed to the downside, and investors expected profits from some of the larger companies.
Elsewhere, Treasuries maintained a nightly rise and crude fluctuated below $ 53 a barrel. European equity futures changed little.
Global stocks have pulled off a record as investors look for new catalysts to boost them or at least justify current valuations. This could come from a list of earnings reports to be delivered this week. Meanwhile, the possibility that a U.S. tax relief package could be delayed is a key reason why Treasury yields rose earlier this year.
“If financial markets needed further confirmation that the U.S. fiscal stimulus was the only game in town, the herd of buying it all got it overnight,” wrote Jeffrey Halley, senior market analyst and Oanda Asia Pacific Pte. Senate Republican concern over the size of the planned package “was enough to remove shares from their intraday highs,” sent lower bond yields and spurred demand for the dollar, he said.
President Joe Biden said he is open to negotiating his $ 1.9 trillion Covid-19 relief proposal, and hopes there will be Republicans behind it, though he did not rule out pursuing a only democratic route. Schumer said Monday he intended to secure the passage of the next round of relief in mid-March, just as unemployment benefits from the last package are exhausted.
As for the pandemic, vaccine coverage will not reach a point that will stop the transmission of the virus in the foreseeable future, the World Health Organization. U.S. head of infectious diseases Anthony Fauci said he is concerned about delays in second doses.
Here are some key events that will be presented next week:
- Microsoft Corp., Apple Inc., Tesla Inc., Facebook Inc., UBS Group AG i Samsung Electronics Co. is among the companies that present results.
- US house price data and consumer confidence arrive on Tuesday.
- The Federal Open Market Committee’s monetary policy decision and President Jerome Powell’s briefing are scheduled for Wednesday.
- Fourth-quarter GDP, initial unemployment claims and new home sales are among U.S. data on Thursday.
- U.S. personal income, spending and pending home sales arrive Friday.
These are the main movements in the markets:
Stocks
- Futures S&P 500 fell 0.5% at 5:30 a.m. in London. The S&P 500 index rose 0.4%.
- The Topix index fell 0.5%.
- The Kospi index fell 2%.
- The Hang Seng index fell 1.9%.
- The Shanghai composite index fell 1.4%.
- Euro Stoxx 50 futures fell 0.1%.
Coins
- The Bloomberg Dollar Spot Index added 0.1%.
- The euro was $ 1.2130.
- The British pound fell 0.2% to $ 1.3652.
- The Japanese yen changed little, to 103.74 per dollar.
- Offshore yuan rose 0.1% to $ 6.4832.
Good
- The ten-year Treasury yield rose one basis point to around 1.04% after falling six basis points on Monday.
Commodities
- West Texas Crude Oil fell 0.7% to $ 52.40 a barrel.
- Gold rose 0.1% to $ 1,857 an ounce.
– With the assistance of Vivien Lou Chen, Katherine Greifeld and Joanna Ossinger