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Bloomberg
US equity futures rose on Tuesday while European shares fluctuated as the selloff that wiped out this year’s gains in global stocks showed signs of easing. Treasuries were steady and the dollar slipped.
Contracts on all three major US indexes rose, though they pared early gains that suggested American markets are poised to claw back just a fraction of February 24’s slump. Declines in carmakers and banks dragged the Stoxx Europe 600 index lower after a modest advance at the open. Ten-year Treasury yields held near record lows, while European bonds were mixed. Crude oil steadied after Monday’s near-4% drop.
Japanese shares tumbled more than 3% as traders returned after a holiday, though the decline was less than the two-session slide on Wall Street while they were away. Stocks fell in China and Australia and pushed higher in South Korea and Hong Kong. The yen strengthened against the dollar for a third day.
Investors are balancing concerns over the impact of the coronavirus against their impulse to buy stocks on dips. The World Health Organization has held off from declaring a global pandemic even as cases surged in South Korea, Italy and Japan.
Some traders may also be taking encouragement from news about the development of treatments, even if experts warn it would take time to build stocks of medicines. Japan’s health minister said the country plans to recommend Fujifilm Holdings Corp’s Avigan drug to treat the virus.
Meanwhile, Mastercard Inc and United Airlines Holdings Inc emerged as the latest companies to warn that profits are getting hurt as the disease spreads beyond its center in China’s Hubei province. Analysts at Oxford Economics Ltd said the epidemic could wipe more than $1 trillion from global domestic product, while the International Monetary Fund lowered its growth forecasts for the world economy.
“The market is flying blind with this virus and how things play out from here,†said Peter Boockvar, chief investment officer at Bleakley Financial Group. “The only two certainties is that the current economic impact is profound globally and that the virus will eventually go away and things will bounce back. What
happens in between is impossible to say.â€
Elsewhere, iron ore futures fell as steel inventories surged to a record in China and investors continued to weigh the impact of the coronavirus outbreak. Gold retreated from the highest level since 2013 as the sell-off in risk assets eased.
Earnings keep rolling in from companies including: Peugeot SA on Wednesday; Baidu Inc, Best Buy Co Inc, Occidental Petroleum Corp and Dell Technologies Inc. on Thursday; and London Stock Exchange Group Plc on Friday.
The Bank of Korea announces its policy decision on Thursday, with rising risks of an interest-rate cut.
US jobless claims, GDP and durable goods data are out on Thursday.
The Stoxx Europe 600 Index dipped 0.3% in London. Futures on the S&P 500 Index climbed 0.4%. The MSCI All-Country World Index declined 0.3%. The UK’s FTSE 100 Index fell 0.4%.
The Bloomberg Dollar Spot Index declined 0.1%. The euro was little changed at $1.0852. The British pound climbed 0.5% to $1.299. The Japanese yen appreciated 0.2% to 110.46 per dollar.
The yield on 10-year Treasuries was unchanged at 1.37%. The yield on two-year Treasuries advanced one basis point
to 1.26%. Germany’s 10-year yield decreased one basis point to -0.50%. Britain’s 10-year yield gained less than one basis point to 0.542%.
West Texas Intermediate crude was little changed at $51.42 a barrel. Gold weakened 0.7% to $1,648.50 an ounce.