(Bloomberg) — European stocks and U.S. stock futures held steady as investors waited for the release of the policy minutes from the latest Federal Reserve meeting for information on the path of price hikes. rates.
The Stoxx Europe 600 held near a three-month high as basic resource and energy stocks gained. Credit Suisse Group AG fell after posting a loss in the fourth quarter. Contracts on the S&P 500 rose after the underlying gauge closed at its highest level since mid-September on Tuesday. Nasdaq 100 futures were little changed. An index of Asian stocks rose.
Attention turns to the subsequent release of the Fed’s November 1-2 meeting minutes. The release will be watched to see how united policymakers weathered a higher spike in interest rates than previously noted in their fight against inflation as investors weigh how aggressively the Fed will move when it meets next month.
“Since the meeting, the market has been anticipating what might happen in December, and this week’s minutes could help confirm the Fed’s intent,” said economists at Rand Merchant Bank in Johannesburg. “The risk to markets from the minutes is that they look less aggressive than expected, which could trigger a reversal of some of the rate hike risk repricing we saw late last week.”
The dollar gauge declined, with the euro and New Zealand currency the best performers among the dollar’s Group of 10 counterparts. New Zealand government bond yields also rose, buoyed by the country’s central bank raising interest rates by 75 basis points. The 10-year US Treasury yield rose one basis point.
In Asian trading, Hong Kong technology shares wavered before consolidating their gains as investors weighed the implications of a report that Ant Group Co. faces a fine of more than $1 billion from China’s central bank. The news triggered speculation that this could mark a potential end point in the government’s crackdown on technology and may allow Alibaba Group Holding Ltd. to revive efforts to list Ant’s shares.
Bitcoin made recent gains after rising as much as 4.2% on Tuesday to knock the digital asset off its lowest price since November 2020.
Oil steadied as traders awaited more details of a plan to cap Russian crude prices and assessed the prospects for demand in Covid-hit China.
US manufacturing data fell below forecasts, confirming the top inflation narrative. San Francisco Fed President Mary Daly said officials should take into account delays in transmitting policy changes, while her Cleveland counterpart Loretta Mester said she was open to moderating the size of rate hikes.
“We believe the Fed leadership wants to break out of the 75 basis points per meeting hamster wheel even though it finds it difficult to do so while maintaining control of financial conditions,” Evercore ISI’s Krishna Guha wrote in a note. “We believe the Fed is still headed for an ‘aggressive slowdown.’ And, at least for us, the slowdown part is what matters.”
Key events this week:
- S&P Global PMI: US, Eurozone, UK, Wednesday
- US MBA Mortgage Applications, Durable Goods, Initial Jobless Claims, University of Michigan Sentiment, New Home Sales, Wednesday
- Minutes from the Federal Reserve meeting on November 1 and 2, Wednesday
- ECB publishes report of its October policy meeting, Thursday
- US stock and bond markets are closed for the Thanksgiving holiday, Thursday
- US stock and bond markets close early on Friday
Some of the main movements in the markets:
- The Stoxx Europe 600 was unchanged at 8:18 a.m. London time
- S&P 500 futures were little changed
- Nasdaq 100 futures were little changed
- Dow Jones Industrial Average futures were little changed
- The MSCI Asia Pacific Index rose 0.4%
- The MSCI Emerging Markets Index rose 0.5%
- The Bloomberg Dollar Spot Index was little changed
- The euro rose 0.3% to $1.0336
- The Japanese yen was little changed at 141.28 to the dollar.
- The offshore yuan fell 0.3% to 7.1556 per dollar
- The British pound was little changed at $1.1883
- Bitcoin rose 2.4% to $16,509.13
- Ether rose 2.9% to $1,161.99
- The 10-year Treasury yield was little changed at 3.76%
- Germany’s 10-year yield rose four basis points to 2.01%.
- The UK 10-year yield rose two basis points to 3.16%
- Brent crude rose 0.9% to $89.14 a barrel
- Spot gold rose 0.1% to $1,742.56 an ounce
This story was produced with the assistance of Bloomberg Automation.