US stock futures fell, oil prices fell and bond yields fell after major indicators rallied To kick off the trading week, with some signs of easing in recent volatility in the markets.
S&P 500 futures fell 1.4% on Wednesday. The technology-focused Nasdaq 100 futures contracted 1.6% and the Dow Jones Industrial Average futures contracted 1.2%. US stocks Tuesday rebounded from its worst week since March 2020providing investors with a respite from the recent period of rough trading that drove stocks and cryptocurrencies down.
Stocks have seen sharp moves in recent weeks after massive interest rate increases by the Federal Reserve, with more expected, as central bank officials seek to stem inflation. Investors rushed to offload riskier assets amid growing concerns that the rapid tightening of financial conditions will plunge the US economy into recession. The S&P 500 is on track for the first half of the year in decades, according to Deutsche Bank research analysts.
Recession fears weighed on energy, auto and travel stocks in pre-market and European trade.
It fell 4.1% before marketing, while
Shares fell 3.9 percent.
It fell 3.3%.
The volatility index – the so-called Wall Street fear gauge, also known as the VIX – rose 3.6% to 31.29.
Investors sought assets seen as safer to hold on Wednesday, such as the US dollar and US government debt. The WSJ Dollar Index, which measures the dollar against a basket of 16 currencies, was up 0.2%.
In the bond markets, the yield on the benchmark 10-year Treasury note fell to 3.228% from 3.304% on Tuesday. Yields decrease when prices rise.
“There is definitely anxiety in the markets and this is playing into volatility,” said Edward Park, chief investment officer at British investment firm Brooks MacDonald, adding that investors were likely waiting for new inflation data or a central bank meeting to assess their future trades.
Federal Reserve Chairman Jerome Powell is scheduled to testify before Congress on Wednesday and Thursday. Investors will be watching his words for clues about the future course of monetary policy.
In energy markets, Brent crude, the international benchmark for oil prices, fell 4.4% to $109.63 a barrel. President Biden plans to call a Temporary suspension of the federal tax on gasoline, the Wall Street Journal reported. Energy prices remain close to historically high levels as the Russian invasion of Ukraine caused Western countries to do so Move quickly away from Moscow supplies.
“This is a reminder to the markets that governments are unlikely to back down and take higher oil prices,” Park said.
The dollar value of bitcoin, the world’s largest cryptocurrency by market cap, is down 2.1% from the 5 p.m. ET level on Tuesday to trade at $2,0393.06, according to CoinDesk. Cryptocurrencies have fallen recently amid widespread investor desire to get out of speculative assets and concerns about the future of Some coding companies.
Offshore, the Stoxx Europe 600 Continental Index is down 1.6%.And the With losses led by core resource sectors, oil and gas and automobiles.
In Asia, the major indices closed with losses. South Korea’s Kospi fell 2.7%, China’s Shanghai Composite fell 1.2%, and Japan’s Nikkei 225 fell 0.4%.
Write to Caitlin Ostroff at [email protected]
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