Stocks mixed on Delta strain jitters; dollar advances

Bloomberg

Stocks were mixed and US futures fluctuated on Tuesday as concerns over a highly infectious Covid-19 strain spurred caution among investors. The dollar strengthened.
The Stoxx Europe 600 Index traded modestly higher, though new limits on travel from Britain prompted by the Delta variant of the virus dragged on cruise operators and airlines. An MSCI index of Asia-Pacific shares was on track for its first
decline in six days as countries in the region struggled to contain the highly
transmissible strain.
S&P 500 futures were little changed after technology stocks led US benchmarks to fresh records in a resurgence of the stay-at-home trade. The Treasury yield curve flattened amid month-end index rebalancing and the break in auctions until July 12, reducing supply. Oil slipped and gold headed for the biggest monthly drop in more than four years.
Global stocks are poised to close out their fifth quarterly advance amid a worldwide vaccine rollout that powered an economic recovery and sparked concerns about increasing prices pressures and the withdrawal of stimulus measures. The recovery also drove the reflation trade as more economies reopened, though that is being hampered as some countries, especially in Asia, are falling behind in their vaccine strategies.
“The Delta variant has also emerged in our client conversations as a potential threat to reflation/inflation,” JPMorgan Chase & Co. strategists led by Marko Kolanovic said. “The economic consequences are likely to be limited given progress on vaccinations across developed market economies. It could, however, pose some risk of a delay in the recovery in countries where vaccination rates remain lower.”
The Stoxx Europe 600 rises 0.2% as of 9:57 am London time and futures on the S&P 500 were little changed.
While futures on the Nasdaq 100 fall 0.2%, futures on the Dow Jones Industrial Average were little changed and the MSCI Asia Pacific Index drops 0.6%. The MSCI Emerging Markets Index also falls 0.5%.
The Bloomberg Dollar Spot Index rises 0.2% and the euro falls 0.2% to $1.1903. while the Japanese yen was little changed at 110.60 per dollar, the offshore yuan was little changed at 6.4639 per dollar. The British pound falls 0.3% to $1.3844.
The yield on 10-year Treasuries was little changed at 1.48% and Germany’s 10-year yield was little changed at -0.18%. Britain’s 10-year yield advanced two basis points to 0.74%.
While Brent crude falls 0.6% to $74.24 a barrel, spot gold falls 0.5% to $1,770.17 an ounce.