US futures turn lower after China stops some imports

Bloomberg

US stock futures turned lower while European shares held onto modest gains after Chinese officials told agriculture companies to pause imports of some farm goods. Treasuries erased their earlier declines.
State-owned traders Cofco and Sinograin were ordered to suspend purchases, according to a person familiar with the matter. The move raises the risk of heightening tensions between the two countries and is the latest sign that the phase-one trade deal is in jeopardy.
European equities climbed as investors focused on signs of economic recovery from the pandemic, with travel companies and banks leading gains in the Stoxx 600 Index. The dollar slid to its lowest since March.
Asia’s session saw more risk-on sentiment. US President Donald Trump stopped short of specifying tough sanctions over China’s new national security law for Hong Kong.
Australia’s central bank is expected to keep its main policy programs unchanged on Tuesday. So too is the case for Canada, which has options to add stimulus but is forecast to stand pat on Wednesday to allow more time to evaluate the progress of policy action.
In Europe, the ECB is expected to top up its rescue program with an additional 500 billion euros of asset purchases. Anything less than an expansion at the meeting would be a big shock, Bloomberg Economics said.
The US labour market report will probably show American unemployment soared to 19.6% in May, the highest since the 1930s.
The Stoxx Europe 600 Index rose 0.6% as of 9:37 am London time and futures on the S&P 500 Index declined 0.4%. The Bloomberg Dollar Spot Index dipped 0.4% and the euro gained 0.3% to $1.1134.
While the British pound increased 0.5% to $1.2401, the Japanese yen strengthened 0.3% to 107.47 per dollar and the Australian dollar jumped 1% to $0.674.
The yield on 10-year Treasuries gained less than one basis point to 0.66% and Germany’s 10-year yield climbed two basis points to -0.42%. Britain’s 10-year yield also rose one basis point to 0.197%.
As West Texas Intermediate crude decreased 0.3% to $35.38 a barrel, gold strengthened 0.5% to $1,738.60 an ounce and iron ore gained 0.1% to $97.25 per metric ton.