(Bloomberg) – Bond yields rose and US futures stabilized as traders waited for inflation data, a Treasury auction, and corporate earnings to gauge the market outlook. Bitcoin has set a record.
The 10-year US benchmark return fell towards 1.7%, with interest rates rising with sympathy across Europe. Gains in European stocks were led by technology stocks, while most US stock futures were little changed.
Tuesday’s US consumer price data is being watched closely as the Federal Reserve has signaled that it is ready to heat up the economy to steer the recovery from the pandemic. While US Federal Reserve policymakers believe consumer price spikes will be short-lived, a faster CPI threatens not only bonds but also stocks with long-term horizons like technology.
“A jump in the US CPI is well marked today, but it should be a wake-up call to what we believe to be stickier inflation in the coming months, if not years,” ING Groep NV strategists, including Padhraic Garvey, wrote in a customer release . “This would expand the Fed’s position progressively.”
According to ING strategists, “policy sensitive” five-year stocks are the most susceptible to deeper sell-offs. The Treasury plans to auction 30-year bonds on Tuesday after the sale of three- and ten-year bonds generated substantial demand on Monday.
Meanwhile, Bitcoin hit an all-time high as sentiment on cryptocurrencies turned bullish before Coinbase Global Inc. went public. The oil rose to $ 60 a barrel.
Some key events to watch this week:
Banks and financial firms report earnings for the first quarter, including JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp., Morgan Stanley and Goldman Sachs Group Inc. The US released inflation data on Tuesday. The Economic Club of Washington is hosting Fed Chair Jerome Powell for a moderated Q&A on Wednesday Federal Reserve released Beige Book on Wednesday. Data such as initial jobless claims, industrial production and retail sales come on Thursday. China’s economic growth, industrial production and retail sales are in on Friday.
Here are some of the most important steps to take in financial markets:
The futures on the S&P 500 index barely changed at 9:40 a.m. London time. The Stoxx Europe 600 Index rose 0.2%. The MSCI Asia Pacific Index gained 0.2%. The MSCI Emerging Market Index hardly changed.
The Bloomberg Dollar Spot Index has hardly changed. The euro was down 0.1% to $ 1.1898. The British pound rose 0.1% to $ 1.375. The onshore yuan barely changed at $ 6.548 per dollar. The Japanese yen barely changed at $ 109.34 per dollar.
The 10-year government bond yield rose two basis points to 1.69%. The two-year government bond yield rose 1 basis point to 0.17%. The 10-year yield in Germany rose by one basis point to -0.29%. Japan’s 10-year yield fell less than a basis point to 0.107%. The UK 10 year return rose 1 basis point to 0.795%.
West Texas Intermediate Crude Oil rose 0.2% to $ 59.82 a barrel. Brent crude rose 0.3% to $ 63.46 a barrel. Gold fell 0.3% to $ 1,727.52 an ounce.
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