Stocks, Futures Steady as Inflation Risk in Focus: Markets Wrap

Andreea Papuc and Namitha Jagadeesh
·3 min read

(Bloomberg) -- Stocks were steady with U.S. futures Thursday as investors weighed the risk of higher inflation spurring a tightening of monetary policy.

Most Read from Bloomberg

In Europe, a slide in energy and travel shares offset gains in construction shares. Contracts on the S&P 500 Index were steady, while those on the Nasdaq 100 edged higher after the gauge’s worst slump in more than a month. In Asia, Chinese equities rallied on speculation officials will seek to ease the cash crunch at struggling property developers.

Concerns about price pressures have brought forward expectations of interest-rate hikes, after Wednesday’s data showing a stronger-than-forecast surge in U.S. consumer prices. The shock sent bonds and tech stocks tumbling as it dealt a blow to the argument that inflation is transitory.

While the U.S. cash Treasury market is shut Thursday for a holiday, most European bonds extended a drop. Sovereign debt also slid in Australia and New Zealand. The dollar ticked up.

“This is the perfect time to gravitate toward defensive plays, to take profit and to be in the sectors that are strategically positioned toward this volatile market that presents a lot of challenges,” Katerina Simonetti, senior vice president at Morgan Stanley Private Wealth Management, said on Bloomberg Television.

In the U.K., data showed the economy grew more strongly than expected in November, which may reinforce expectations that policymakers will raise interest rates next month to rein in inflation. The FTSE 100 Index rose.

European Central Bank Governing Council member Robert Holzmann said the monetary authority could stop buying bonds as early as next September if inflation looks to have sustainably returned to the official target.

Meanwhile, gold added to gains and Bitcoin held below $65,000 after dipping from a fresh all-time high Wednesday. Oil steadied, with investors weighing whether the White House will intervene to try and cool prices.

Elsewhere, Chinese technology shares jumped on a report that Didi Global Inc. is preparing to reintroduce its apps in the country by year-end as regulators wrap up their probes into the ride-hailing giant.

Traders digested filings showing Tesla Inc. Chief Executive Officer Elon Musk unloaded $5 billion of stock in the firm.

What to watch this week:

  • China’s Communist Party’s decision-making Central Committee meets through Thursday

  • U.S. bond marked is closed in observance of Veterans Day Thursday

  • China holds its annual Singles’ Day, the world’s biggest shopping festival, when e-commerce giants like Alibaba and JD.com Inc. lure buyers with bargains Thursday

For more market analysis, read our MLIV blog.

Stocks

  • The Stoxx Europe 600 was little changed as of 8:28 a.m. London time

  • Futures on the Nasdaq 100 rose 0.3%

  • Futures on the Dow Jones Industrial Average were little changed

  • The MSCI Asia Pacific Index was little changed

  • The MSCI Emerging Markets Index fell 0.1%

Currencies

  • The Bloomberg Dollar Spot Index rose 0.2%

  • The euro fell 0.1% to $1.1462

  • The Japanese yen fell 0.2% to 114.09 per dollar

  • The offshore yuan was little changed at 6.4036 per dollar

  • The British pound fell 0.2% to $1.3377

Bonds

  • Germany’s 10-year yield advanced one basis point to -0.23%

  • Britain’s 10-year yield was little changed at 0.93%

Commodities

  • Brent crude rose 0.1% to $82.76 a barrel

  • Spot gold rose 0.4% to $1,857.59 an ounce

Most Read from Bloomberg Businessweek

©2021 Bloomberg L.P.

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting

Recommended Stories

  • Inflation in U.S. Builds With Biggest Gain in Prices Since 1990

    (Bloomberg) -- U.S. consumer prices rose last month at the fastest annual pace since 1990, cementing high inflation as a hallmark of the pandemic recovery and eroding spending power even as wages surge.Most Read from BloombergWhy Hong Kong Is Building Apartments the Size of Parking SpacesDo Prisons Deserve a Second Chance?Farmers Take on ‘Post-Apocalyptic’ Food CrisisCOP26 Protests: Inflatable Cows, Megaphones and a RainbowThe consumer price index increased 6.2% from October 2020, according to L

  • Jeremy Grantham Says Fed Is Erring on Highest Inflation Since 1990

    (Bloomberg) -- Investors’ faith in the Federal Reserve has become so unshakable that not even the highest inflation in three decades is enough to cause a sell-off in assets, said Jeremy Grantham.Most Read from BloombergWhy Hong Kong Is Building Apartments the Size of Parking SpacesFarmers Take on ‘Post-Apocalyptic’ Food CrisisDo Prisons Deserve a Second Chance?Greece’s Popular Islands Are Crowded — With Plastic“We’ve never seen anything like this,” Grantham told Bloomberg Television’s “Wall Stre

  • Toshiba's lurch from crisis to crisis since 2015

    Toshiba Corp plans to unveil a new business strategy on Friday. The once-storied conglomerate has been battered by accounting scandals, massive writedowns for its U.S. nuclear business, the sale of its prized chip unit and it was also found to have colluded to prevent overseas investors from gaining influence. Here is a timeline of Toshiba' woes since 2015.

  • U.K. Economy Accelerates on Stronger Services and Construction

    (Bloomberg) -- Sign up for the New Economy Daily newsletter, follow us @economics and subscribe to our podcast.Most Read from BloombergWhy Hong Kong Is Building Apartments the Size of Parking SpacesFarmers Take on ‘Post-Apocalyptic’ Food CrisisDo Prisons Deserve a Second Chance?Greece’s Popular Islands Are Crowded — With PlasticThe U.K. economy grew more strongly than expected in September after a surge in service industries and construction.Gross domestic product rose 0.6% from August, the Offi

  • Bitcoin, Ether Hit New All-Time Highs

    "The Hash" panel discusses their reading of the crypto markets as the prices of bitcoin and ether hit new all-time highs, with BTC breaking $68,000 and ether rallying above $4,800. Where do we go from here?

  • DoorDash to acquire food delivery company Wolt

    On-demand delivery giant DoorDash announced Tuesday it was acquiring food delivery company Wolt in an all-stock deal valued at €7 billion, or $8.1 billion. Talking about the acquisition, Tony Xu, co-founder and CEO of DoorDash said in a statement that the move “will accelerate our product development, bring greater focus to each of our markets and improve the value we provide to consumers, merchants, as well as Dashers and couriers around the world.” Finland-based Wolt was founded in 2014 by Miki Kuusi, who, upon the deal closing, will run DoorDash International and report to Xu.

  • First Mover Asia: Bitcoin Enters ‘Extreme Greed’ Territory; Altcoins Rally

    Bitcoin volume has increased the past two days but remains well below its mid-October high.

  • All ECB Bond Purchases Could End Next Fall, Holzmann Says

    (Bloomberg) -- Sign up for the New Economy Daily newsletter, follow us @economics and subscribe to our podcast.Most Read from BloombergWhy Hong Kong Is Building Apartments the Size of Parking SpacesFarmers Take on ‘Post-Apocalyptic’ Food CrisisDo Prisons Deserve a Second Chance?Greece’s Popular Islands Are Crowded — With PlasticThe European Central Bank could stop buying bonds as early as next September if inflation looks to have sustainably returned to the official target, Governing Council mem

  • What Powell learned from past Fed mistakes on guiding the US out of a recession

    Powell has been clear about the Fed's tapering plans, and how it intends to balance its support of the economy with rising inflation.

  • After Copper Chaos, LME Mulls Rules to Keep From Running Out of Metal

    (Bloomberg) -- The London Metal Exchange is considering whether it should sometimes block traders from withdrawing inventory from its warehouses, in order to guard against running out of metal entirely. Most Read from BloombergWhy Hong Kong Is Building Apartments the Size of Parking SpacesFarmers Take on ‘Post-Apocalyptic’ Food CrisisDo Prisons Deserve a Second Chance?Greece’s Popular Islands Are Crowded — With PlasticSuch a move would mark a significant shift in philosophy for the 144-year-old

  • GoTo Snags $1.3 Billion Ahead of IPO by Indonesia Tech Giant

    (Bloomberg) -- GoTo Group, formed this year by the merger of Indonesia’s two most valuable internet startups, raised more than $1.3 billion in the first closing of a fundraising round ahead of its initial public offering.Most Read from BloombergWhy Hong Kong Is Building Apartments the Size of Parking SpacesFarmers Take on ‘Post-Apocalyptic’ Food CrisisDo Prisons Deserve a Second Chance?Greece’s Popular Islands Are Crowded — With PlasticInvestors in the pre-IPO round included the Abu Dhabi Invest

  • Signs of Easing as Delayed Bond Coupons Paid: Evergrande Update

    (Bloomberg) -- Investor speculation that China will take steps to ease the cash crunch for embattled developers drove property stocks and bonds higher.Most Read from BloombergWhy Hong Kong Is Building Apartments the Size of Parking SpacesFarmers Take on ‘Post-Apocalyptic’ Food CrisisDo Prisons Deserve a Second Chance?Greece’s Popular Islands Are Crowded — With PlasticA series of articles published in state media in the past few days signal support measures are on the way to help developers tap d

  • EXPLAINER: What's behind the crisis at Belarus-Poland border

    Thousands of migrants have flocked to Belarus' border with Poland, hoping to get to Western Europe, and many of them are now stranded at the frontier, setting up makeshift camps as Polish security forces watch them from behind a razor-wire fence and prevent them from entering the country. Belarus was rocked by months of massive protests following the August 2020 election that gave authoritarian President Alexander Lukashenko a sixth term in office. Belarusian authorities responded to the demonstrations with a fierce crackdown that saw more than 35,000 people arrested and thousands beaten by police.

  • Elon Musk sells $5 billion of Tesla stock after Twitter poll

    Elon Musk has sold almost $5 billion in Tesla stock during a spate of transactions, CNBC first reported Wednesday evening.Why it matters: The sale follows Musk's posting of an informal poll on Twitter Saturday, asking his followers whether he should sell about 10% of his shares in Tesla and after the company's stock fell 12% on Tuesday.Stay on top of the latest market trends and economic insights with Axios Markets. Subscribe for freeMuch is made lately of unrealized gains being a means of tax a

  • China Developers Surge Higher on Easing News, Evergrande Payment

    (Bloomberg) -- Chinese developers booked their best two-day gain in six years on hopes that Beijing may ease some property curbs and as embattled China Evergrande Group paid overdue interests on some dollar bonds.Most Read from BloombergWhy Hong Kong Is Building Apartments the Size of Parking SpacesFarmers Take on ‘Post-Apocalyptic’ Food CrisisDo Prisons Deserve a Second Chance?Greece’s Popular Islands Are Crowded — With PlasticA Bloomberg gauge of the nation’s developer shares jumped as much as

  • COP26: Cautious welcome for unexpected US-China climate agreement

    The world's two biggest CO2 emitters pledge to boost climate co-operation in an unexpected declaration.

  • Exclusive-Didi prepares to relaunch apps in China, anticipates data probe will end soon -sources

    HONG KONG/BEIJING (Reuters) -Didi Global is preparing to relaunch its ride-hailing and other apps in China by the end of the year in anticipation that Beijing's cybersecurity investigation into the company will be wrapped up by then, three people directly involved in the relaunch said. The people, who declined to be identified as the information was private, said they expected China's cyberspace regulator to finalise any penalties on the company in December. In July, the powerful Cyberspace Administration of China (CAC) ordered app stores to remove 25 mobile apps operated by Didi - just days after the ride-hailing giant listed in New York.

  • Suze Orman says this is the only asset class that has a track record of beating inflation — don't give up on it just yet

    Experts are worried about this asset. But Suze still likes it.

  • 7 Stocks to Buy That Could Be the Next Trillion-Dollar Company

    Which stocks to buy before they explode is the million-dollar question. When Tesla (NASDAQ:TSLA) became the next trillion-dollar company on Oct. 26 when its share price got a boost from Hertz Global Holdings (OTCMKTS:HTZZ) announcement it would buy 100,000 Model 3’s from the electric vehicle maker. After the announcement by Hertz, Tesla CEO Elon Musk suggested that a contract hadn’t been signed yet, sending TSLA shares lower. However, despite throwing cold water on the news, the company’s market

  • 3 Cathie Wood Stocks That Could Beat Bitcoin

    Cathie Wood's ARK Invest firm has a reputation for scoring big wins with explosive growth plays -- and it's no secret the famous investor is bullish on Bitcoin (CRYPTO: BTC). Read on to see why a panel of Motley Fool contributors thinks these three Cathie Wood stocks can outperform Bitcoin. Keith Noonan: Unity Software (NYSE: U) stands as the fourth-largest overall holding in Cathie Wood's Ark Innovation ETF, and I think the interactive-software development company stands a good chance of crushing the market over the long term.