U.S. Futures Drop With Dollar; Treasuries Climb: Markets Wrap - Yahoo Finance

(Bloomberg) -- Wednesday brought another day of reversals in many major markets, with U.S. stock futures dropping, the dollar weakening and Treasury yields falling after surging a day earlier.

Contracts on the S&P 500 Index fell about 2% after the U.S. administration failed to offer details on what President Donald Trump said would be “major” measures to combat the economic impact of the coronavirus. The Stoxx Europe 600 climbed as the European Central Bank indicated it may act as soon as this week and the Bank of England cut rates.

Most Asian benchmarks fell, while the yen rallied. Crude oil’s rebound from its biggest crash in a generation faltered after Saudi Arabia said it would boost production. The pound fluctuated before turning higher and gilts declined after the BOE reduced its main interest rate by 50 basis points.

The BOE’s emergency move came a week after the Federal Reserve slashed its main rate, and as ECB President Christine Lagarde warned of an economic shock similar to the financial crisis unless leaders acts urgently -- comments which suggest the bank may join the wave of crisis easing when it sets policy on Thursday. The U.K. is expected to unveil an expansionary budget later Wednesday, and Germany and Italy have also announced fiscal support.

“Despite the hopes for fiscal stimulus everywhere, we see significant downside risks,” said Guillaume Tresca, a strategist at Credit Agricole SA in Paris. “As long as uncertainties remain on the number of cases, and central banks’ actions and fiscal stimulus plans are not lifted, we see few reasons for a protracted and long-term rebound.”

Meanwhile, Joe Biden cemented his position as front-runner for the U.S. Democratic presidential nomination with primary victories Tuesday, further easing concerns among those opposing Bernie Sanders’s progressive platform.

Here are some key events coming up:

The European Central Bank’s policy decision comes Thursday amid expectations it may ease policy.The U.K. Chancellor of the Exchequer unveils the government’s 2020 budget on Wednesday.The U.S. core consumer price index, due Wednesday, is expected to remain subdued in February.

These are the main moves in markets:

Stocks

The Stoxx Europe 600 Index rose 1.4% as of 6:23 a.m. New York time.Futures on the S&P 500 Index decreased 2%.The MSCI All-Country World Index dipped 0.1%.The U.K.’s FTSE 100 Index gained 0.8%.

Currencies

The Bloomberg Dollar Spot Index dipped 0.2%.The euro rose 0.3% to $1.1315.The British pound gained 0.2% to $1.294.The Japanese yen strengthened 0.7% to 104.94 per dollar.

Bonds

The yield on 10-year Treasuries sank 10 basis points to 0.70%.The yield on two-year Treasuries fell nine basis points to 0.44%.Germany’s 10-year yield increased three basis points to -0.76%.Britain’s 10-year yield gained five basis points to 0.288%.

Commodities

West Texas Intermediate crude fell 3.3% to $33.23 a barrel.Gold strengthened 0.8% to $1,663.03 an ounce.

--With assistance from Adam Haigh and Winnie Zhu.

To contact the reporter on this story: Robert Brand in Cape Town at rbrand9@bloomberg.net

To contact the editor responsible for this story: Sam Potter at spotter33@bloomberg.net

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