(Bloomberg) — Nasdaq 100 Index futures dropped as Microsoft Corp. and Google’s parent Alphabet Inc. delivered a mixed picture of big tech earnings. Oil fell for a fourth day amid diplomatic efforts to maintain stability across the Middle East.
Most Read from Bloomberg
Contracts on the Nasdaq sank 0.8% and those on the S&P 500 were down 0.5%. Europe’s stock benchmark was also weaker as earnings from some of the region’s biggest consumer-facing companies stoked concerns that a global economic slowdown is hurting corporate profits.
Kering SA slid after the Gucci owner reported a drop in sales amid a global slowdown in luxury, while home products company Reckitt Benckiser Group Plc fell after sales missed expectations. Worldline SA plunged as much as 40%, the biggest decline ever, after the French payment company lowered its outlook for this year. Peer Nexi SpA slumped more than 10%.
The Treasury 10-year yield rose two basis points and a gauge of the dollar ticked higher. Shares in Asia pushed higher after the government stepped up support for China’s economy and stock trading. The Hang Seng Tech Index gained 2.2%.
With earnings season in full swing, investors are looking for evidence on how companies are coping with high interest rates and whether consumer spending is changing because of inflation. Meta Platforms Inc., the parent company of Instagram and Facebook, is set to announce earnings later Wednesday. Meanwhile, elevated bond yields continue to weigh on appetite for equities, with major central banks set to hold policy rates high to bring down inflation.
“Rates will likely trade within recent ranges, but we do think that the latest US data provides some support to the higher-for-longer theme,” said Evelyne Gomez-Liechti, a strategist at Mizuho International. “We wouldn’t be surprised to see 10-year Treasury yields testing the 5% handle again.”
Meanwhile, troubled Chinese developer Country Garden Holdings Co. was deemed to be in default on a dollar bond for the first time, amid the broader property-debt crisis that’s shaken China’s economy.
Global benchmark Brent crude dipped below $88 a barrel, and has now erased about half of its gains since Hamas’ attack on Oct. 7, while West Texas Intermediate traded near $83. The US and Saudi Arabia agreed to pursue diplomatic efforts, the White House said Tuesday, helping to ease fears of major disruptions to the oil market.
Bank of Japan officials are likely to monitor bond yield movements until the last minute before making a decision on whether to adjust the yield curve control program at a policy meeting next week, according to people familiar with the matter. The yen was little changed Wednesday.
Key events this week:
-
Canada rate decision, Wednesday
-
US new home sales, Wednesday
-
IBM, Meta earnings, Wednesday
-
European Central Bank interest rate decision; President Christine Lagarde holds news conference, Thursday
-
US wholesale inventories, GDP, US durable goods, initial jobless claims, pending home sales, Thursday
-
Intel, Amazon earnings, Thursday
-
China industrial profits, Friday
-
Japan Tokyo CPI, Friday
-
US PCE deflator, personal spending and income, University of Michigan consumer sentiment, Friday
-
Exxon Mobil earnings, Friday
And here are some of the main market moves:
Stocks
-
The Stoxx Europe 600 fell 0.4% as of 9:04 a.m. London time
-
S&P 500 futures fell 0.5%
-
Nasdaq 100 futures fell 0.7%
-
Futures on the Dow Jones Industrial Average were little changed
-
The MSCI Asia Pacific Index rose 0.3%
-
The MSCI Emerging Markets Index was little changed
Currencies
-
The Bloomberg Dollar Spot Index rose 0.1%
-
The euro was unchanged at $1.0590
-
The Japanese yen was little changed at 149.88 per dollar
-
The offshore yuan was little changed at 7.3205 per dollar
-
The British pound fell 0.1% to $1.2145
Cryptocurrencies
-
Bitcoin rose 0.6% to $33,836.98
-
Ether fell 0.3% to $1,766.85
Bonds
-
The yield on 10-year Treasuries advanced two basis points to 4.84%
-
Germany’s 10-year yield was little changed at 2.83%
-
Britain’s 10-year yield declined two basis points to 4.52%
Commodities
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Michael Msika, Tassia Sipahutar and Cecile Gutscher.
Most Read from Bloomberg Businessweek
©2023 Bloomberg L.P.
