(Bloomberg) -- U.S. equity futures slid with European stocks on Tuesday as the jump in bond yields and commodity prices continued to hammer technology shares.
Nasdaq futures slumped 1.6% a day after the tech-heavy gauge posted its longest losing streak in four months. Tesla Inc. dropped 6% in pre-market trading as investors continued to punish stocks that have led the rally from the depths of the pandemic a year ago. In Europe, tech shares dragged the Stoxx 600 Index lower.
Budding inflation bets spurred by the global economic recovery are adding to pressure on equities. Treasuries steadied on Tuesday after the gap between 5- and 30-year yields touched the highest level in more than six years. Copper extended gains, while WTI crude rose toward $63 a barrel.
One concern among investors is that broad benchmarks have already priced in much of the prospective global recovery spurred by vaccines and U.S. stimulus. Alongside rising inflation, another is that central banks may eventually start reconsidering emergency programs that have supported global markets.
Traders are waiting to hear from Federal Reserve Chair Jerome Powell when he testifies to the Senate Banking Committee on Tuesday and the House Financial Services panel the following day. He’s expected to play down the risk of inflation despite the size of President Joe Biden’s $1.9 trillion coronavirus relief proposal.
“Fed Chair Jay Powell will be torn today,” ING analysts led by Padhraic Garvey wrote in a anote. “A bit of inflation is a good thing; it’s what the Fed has wanted. But too much anticipation of it is not good, as it tightens policy prematurely.”
Elsewhere, Bitcoin retreated below $50,000 after a bout of volatility highlighted lingering doubts about the durability of the token’s rally.
Some key events to watch this week:
Fed Chair Jerome Powell delivers the central bank’s semi-annual monetary policy report to the Senate Banking Committee on Tuesday.EIA crude oil inventory report is out Wednesday.Finance ministers and central bankers from the Group of 20 will meet virtually Friday. U.S. Treasury Secretary Janet Yellen will be among the attendees.
These are some of the main moves in markets:
Stocks
Futures on the S&P 500 Index declined 0.5% as of 6:55 a.m. New York time.The Stoxx Europe 600 Index decreased 1%.The MSCI Asia Pacific Index advanced 0.2%.The MSCI Emerging Market Index was little changed.
Currencies
The Bloomberg Dollar Spot Index was little changed.The euro was little changed at $1.2154.The British pound jumped 0.2% to $1.4095.The onshore yuan was little changed at 6.464 per dollar.The Japanese yen weakened 0.2% to 105.24 per dollar.
Bonds
The yield on 10-year Treasuries gained less than one basis point to 1.37%.The yield on two-year Treasuries dipped less than one basis point to 0.11%.Germany’s 10-year yield increased four basis points to -0.30%.Britain’s 10-year yield advanced four basis points to 0.717%.Japan’s 10-year yield was unchanged at 0.125%.
Commodities
West Texas Intermediate crude gained 0.6% to $62.10 a barrel.Brent crude increased 0.6% to $65.63 a barrel.Gold was little changed at $1,809.06 an ounce.
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