(Bloomberg) — Futures followed stocks lower Monday as investors braced for a flood of earnings amid doubts about an uneven economic recovery.
U.S. equity futures slipped across the board following a third straight week of gains and fresh records for the S&P 500 Index. In Europe, retailers and travel companies led declines on the Stoxx Europe 600 Index.
The yield on 10-year Treasuries steadied before a round of auctions that will be widely watched for their potential to extend the rate surge that’s shaken stocks to commodities to emerging markets this year. The U.S. sells three-, 10- and 30-year Treasuries at the start of the week.
While the U.S. recovery is accelerating, parts of Europe and South America are beset by rising Covid-19 cases and troubled vaccination rollouts. The rotation toward cyclical and small-cap stocks appears to have stalled as well, prompting worry about the strength of the U.S. economic comeback at the start of earnings season.
“The breakdown of small caps and cyclicals is a potential early warning sign that the actual reopening of the economy will be more difficult than dreaming about it,” Morgan Stanley strategist Mike Wilson wrote in a client note.
Oil rose and Bitcoin neared an all-time high before a listing by the largest U.S. cryptocurrency exchange.
Elsewhere, traders will be watching for any further escalation between Russia and Ukraine, after Russia warned that growing violence in Ukraine could set off a broader military conflict.
Some key events to watch this week:
Banks and financial firms begin reporting first-quarter earnings, including JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp., Morgan Stanley, Goldman Sachs Group Inc.U.S. officials and company executives are due to discuss the global shortage of computer chips on Monday.The U.S. releases inflation data Tuesday.Chinese trade data are scheduled for Tuesday.Economic Club of Washington hosts Fed Chair Jerome Powell for a moderated Q&A on Wednesday.U.S. Federal Reserve releases Beige Book on Wednesday.U.S. data including initial jobless claims, industrial production and retail sales come Thursday.China economic growth, industrial production and retail sales figures are on Friday.
These are some of the main moves in financial markets:
Futures on the S&P 500 Index sank 0.2% as of 6:42 a.m. New York time.The Stoxx Europe 600 Index sank 0.2%.The MSCI Asia Pacific Index decreased 0.7%.The MSCI Emerging Market Index fell 0.9%.
The Bloomberg Dollar Spot Index dipped 0.1%.The euro gained 0.1% to $1.1911.The British pound jumped 0.4% to $1.3755.The onshore yuan strengthened 0.1% to 6.546 per dollar.The Japanese yen strengthened 0.3% to 109.31 per dollar.
The yield on 10-year Treasuries climbed less than one basis point to 1.66%.The yield on two-year Treasuries increased less than one basis point to 0.15%.Germany’s 10-year yield fell one basis point to -0.32%.Japan’s 10-year yield declined less than one basis point to 0.108%.Britain’s 10-year yield advanced one basis point to 0.782%.
West Texas Intermediate crude increased 1.1% to $59.95 a barrel.Brent crude gained 1.2% to $63.70 a barrel.Gold weakened 0.1% to $1,741.53 an ounce.