A three-day rally in global stocks faded on Thursday as Asian shares retreated and U.S. futures fluctuated. Treasuries held overnight losses which saw the yield curve reach its steepest level in almost five years.
S&P 500 futures were little changed after the gauge closed barely in the green Wednesday following its biggest two-day rally in almost three months. The Nasdaq 100 finished lower as Amazon.com Inc. slumped, while Google’s parent Alphabet Inc. hit a record on stellar results. South Korean stocks accounted for the bulk of losses in Asia.
Oil continued its ascent as OPEC+ said it will keep pushing to quickly clear the surplus left behind by the pandemic. A widely watched segment of the Treasury yield curve reached its steepest level since 2016. The dollar was little changed.
Investors are mulling scattered signs of a pickup in U.S. activity amid a push from President Joe Biden to win congressional passage of a $1.9 trillion stimulus proposal. Data showed companies added more jobs than forecast in January, while growth at service providers accelerated. Federal Reserve Bank of St. Louis President James Bullard said stock prices reflect optimism about the economic recovery.
“There has been a ton of noise in the stock market these past few weeks, so it’s encouraging to see solid economic reads,” said Mike Loewengart, managing director of investment strategy at E*Trade Financial Corp. “There may be signs of overextension when it comes to single stocks, but under the surface there is an economy regaining serious momentum.”
Elsewhere, GameStop Corp., the poster child for Redditors looking to squeeze short sellers, rebounded following Tuesday’s plunge. Meantime, AstraZeneca Plc and the University of Oxford have started looking at how to re-engineer their coronavirus vaccine to defat new mutations.
“The second half of this year is really dependant on the vaccine, so that’s a risk,” Megan Greene, senior fellow at Harvard Kennedy School, said on Bloomberg TV. “The labor market is certainly healing but there is a long way to go,” so “some of the scarring could offset some of the pent-up demand that investors are hoping for.”
These are some key events coming up:
- The Bank of England sets rates on Thursday and an Indian central bank policy decision is due Friday.
- The U.S. January payrolls report is due Friday.
These are some of the main moves in markets:
Stocks
- S&P 500 futures rose 0.1% as of 11:01 p.m. in Tokyo. The gauge advanced 0.1% on Wednesday.
- Japan’s Topix index was little changed.
- Hong Kong’s Hang Seng slipped 0.2%.
- Shanghai Composite Index fell 0.8%.
- South Korea’s Kospi lost 1.1%.
- Australia’s S&P/ASX 200 Index slipped 0.6%.
Currencies
- The Bloomberg Dollar Spot Index was little changed.
- The euro bought $1.2037.
- The yen was little changed at 105.04 per dollar.
- The offshore yuan was at 6.4610 per dollar.
Bonds
- The yield on 10-year Treasuries was at 1.14%.
- Australia’s 10-year yield was at 1.21%.
Commodities
- West Texas Intermediate crude increased 0.9% to $56.20 a barrel.
- Gold was at $1,822.99 an ounce, 0.6% lower.
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February 04, 2021 at 05:09AM
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Stock Rally Fades; Treasury Yield Curve Steepens: Markets Wrap - Bloomberg
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