US Futures Edge up in the bear market after the S&P 500 slides

Global stocks have come under pressure in recent weeks due to concerns that major central banks may move more aggressively than expected to combat inflation. The Recent data release Consumer prices in the United States have fueled these fears as they have risen 8.6% since last month, the highest level in more than four decades. The S&P 500 has lost more than 10% in the last four straight trading sessions. The index is down nearly 22% from its last record high.

“I do not need to read a lot on a kind of small reversal. Things are really over, and now people are going to wait for the central bank,” said Colin Graham, head of Roboco’s multicad strategy.

The Federal Reserve is due to release its monetary policy decision on Wednesday after a two-day meeting. The Wall Street Journal announced Monday that policymakers are considering a Surprise 0.75-point interest-rate increase.

Mr Graham said some investors would bargain across the markets after such a sharp decline. “At one point yesterday, every share in the S&P 500 fell. As long-term investors, we look for value as long as the economic damage is not great.

Investors are struggling to keep up with the powerful forces in the market: rising inflation is eroding consumer purchasing power, and the recession is likely to damage the company’s profits and push weak companies into failure. A bond market indicator illustrates the difference in yield curve between two-year and 10-year government debt, which briefly reverses overnight and warns of a recession. In the European morning, it rose 0.011 percentage points.

The US yield curve finally turned upside down In April, Short-term treasury yields were higher than long-term expectations, based on expectations that the central bank could raise rates at a faster pace following a strong jobs report.

Bond markets were broadly more stable on Tuesday. The benchmark 10-year Treasury paper yield fell to 3.307% from 3.371% on Monday, changing direction four times in a row. Days of Rise. When yields fall, prices rise.

Yields on some short-dated bonds also rose to 3.290% on the two-year margin from 3.279% the previous day. According to an analysis, Lehman Brothers is down after its biggest two-day improvement in a week.

Deutsche Bank.

The producer-price index for May, a measure of inflation for domestic producers, will arrive at ET at 8:30 p.m. Economists predict an increase over the previous month.

Although many markets have come under pressure this year, rising rates have had a particularly major impact on the shares of money-losing companies that were once plagued by epidemics and other speculation. Higher interest rates on secured assets such as government securities, while raising corporate borrowing costs, reduce the relative appeal of risky investments — and reduce the perceived value of future cash flows.

“I do not think we’re going to see anything like a V-shaped recovery,” said Rick Bitcoin, chief investment officer at Bitcoin, a Pennsylvania-based family-owned multi-family office. “The way we rebuild will be very paralyzed — it will not return to more speculative stocks.”

In pre-market trading, business software company

Oracle

Rose 13% after the report Rise in quarterly sales Operated by its cloud-computing division, it surpassed the expectations of analysts.

Overseas, Pan-Continental Stoxx Europe 600 fell 1%. Shares of a French IT company Ados fell 27% After the resignation of its CEO and said that the company plans to disable its big data and security division.

Bonds issued by the Greek government, one of the weakest European economies, were sold out. The 10-year yield has risen to 4.650%, the highest level since November 2018.

In Asia-Pacific trading, Australian stocks lost ground after the market reopened following the holiday. Sydney S&P / ASX 200 index cleared 3.6%, its The biggest one-day drop in percentage terms over more than two years.

The Shanghai Composite Index was up 1%, while Hong Kong’s Hong Seng Index was flat. Japan’s Nikkei 225 fell 1.3%.

The Japanese yen changed slightly, nearing the dollar’s weakest level in 24 years, reaching Monday.

Bitcoin, the largest cryptocurrency, has been under pressure after selling hard in recent days. On Tuesday it lost about 4% and traded at $ 22,300. This is 68% from its last record.

Among commodities, Brent crude, the global oil benchmark, rose 0.7% to trade at $ 123.06.

Write to Anna Hirtenstein at [email protected] and Dave Sebastian at [email protected]