(Bloomberg) – U.S. futures have slipped and stocks have been mixed as investors continued to pull back from pandemic winners like technology and look to sectors poised to gain from economic reopening.
Contracts on the Nasdaq 100 index fell 0.3% per day after companies like Tesla Inc. and Amazon.com Inc. lowered the underlying gauge amid signs of accelerating inflation . Technology stocks also lagged the Stoxx Europe 600 index the most, with semiconductor company Infineon Technologies AG falling 5%.
In contrast, cyclical stocks such as miners and travel helped fuel the European benchmark as a commodity price gauge hovered at its highest level since 2012. Futures on the Dow Industrial Average also outperformed.
The dollar surged, while Treasuries fell alongside most European bonds. The digital Ether token extended its surge to set another record as bigger rival Bitcoin slipped.
As the global economic recovery gathers pace with the successful deployment of vaccines across much of the developed world, investors remain risk-sensitive nonetheless. Inflation is a major concern, with a gauge of prices paid for materials reaching its highest level since 2008 on Monday. The extent of the rebound is also an open question, after Federal Reserve Chairman Jerome Powell said economic progress had been uneven across racial and income divisions.
Meanwhile, fierce new waves of Covid-19 are enveloping India and parts of Southeast Asia, straining their healthcare systems and sparking calls for help.
“We believe inflationary pressures will continue this year and this is driven by the kind of politics we’ve seen around the world,” Rupal Agarwal, quantitative strategist at Sanford C Bernstein, told Bloomberg TV. “In the near term you can expect some market pullback, but the general sentiment remains bullish” as reopening and reflation trade remains in effect, she said.
Elsewhere, shares rose in Hong Kong, Australia and South Korea.
Here are some key events to watch out for this week:
US trade balance, factory orders and durable goods due Tuesday Chicago Fed Chairman Charles Evans gives a virtual speech at an event hosted by Bard College on Wednesday. Cleveland Fed Chairman Loretta Mester gives virtual speech to Boston Economic Club, Bank of England rate decision on Thursday
Here are some of the main movements in the markets:
Futures contracts on the S&P 500 index fell 0.1% at 6:46 a.m. (New York time). The Stoxx Europe 600 index gained 0.1%. The MSCI Asia Pacific index fell 0.1%. The MSCI Emerging Market index was little changed.
The Bloomberg Dollar Spot Index rose 0.3%, the euro fell 0.4% to $ 1.212, the British pound fell 0.2% to $ 1.3882, the onshore yuan fell changed little to 6.475 to the dollar and the Japanese yen weakened 0.3% to $ 109.41
The yield on 10-year Treasuries jumped two basis points to 1.62%. The yield on two-year Treasury bills rose one basis point to 0.16%. Germany’s 10-year yield gained one basis point to -0.19%. Britain’s 10-year yield rose one basis point to 0.852%. Japan’s 10-year yield was unchanged at 0.097%.
West Texas Intermediate crude rose 1.7% to $ 65.60 a barrel, crude crude 1.8% to $ 68.79 a barrel, while gold weakened 0.5% at $ 1,783.28 per ounce.
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