Stocks, US futures fall on inflation concern

Bloomberg

Stocks fall with US futures on Wednesday as concerns about faster inflation and Covid-19 flare-ups in some nations rattled investors. Oil dropped for a second day.
The Stoxx Europe 600 Index fell the most in a week, with commodity and leisure shares leading the drop. Contracts on all three US benchmarks were lower, led by those on the Nasdaq 100 Index, signaling further declines for technology shares after the slide. Asian shares also fell, and Australian equities had their worst day in
almost three months.
Yields on 10-year Treasuries rise, while the dollar held near its lowest level this year. Oil dropped on rising US stockpiles and the possibility of more supply from Iran. Markets were closed on Wednesday in Hong Kong and South Korea.
Stocks have lost steam in recent sessions, with pricier sectors such as technology tumbling, as investor optimism about an economic rebound has given way to worries about inflation and a Covid-19 resurgence in some countries. While policymakers have signaled they intend to maintain an accommodative stance for some time to come, traders will parse minutes from the Federal Reserve’s last meeting for clues about the outlook.
“The market has been trying to process a very unusual economic environment and a confluence of factors that it has not faced for a long time,” said David Donabedian, chief investment officer of CIBC Private Wealth Management. “I personally would say that the stock market has absorbed it all extremely well because there’s still a high conviction view on earnings being strong.”
Elsewhere, Bitcoin and other cryptocurrencies extended a tumble, in part after the People’s Bank of China reiterated that digital tokens can’t be used as a form of payment.
The Stoxx Europe 600 falls around 1% as of 8:17 am London time and futures on the S&P 500 drops as much as 0.5%.
While futures on the Nasdaq 100 fall 0.8%, futures on the Dow Jones Industrial Average drop 0.4%. The MSCI Asia Pacific Index falls 0.5% and the MSCI Emerging Markets Index was little changed.
While the Bloomberg Dollar Spot Index was little changed, the euro rises 0.1% to $1.2238
While the Japanese yen was little changed at 109.00 per dollar, the offshore yuan falls 0.1% to 6.4287 per dollar and the British pound was little changed at $1.4193
While the yield on 10-year Treasuries advanced two basis points to 1.65%, Germany’s 10-year yield advanced two basis points to -0.08% and Britain’s 10-year yield advanced two basis points to 0.89%. Brent crude falls 1.1% to $68 a barrel and spot gold was little changed.