European stocks, U.S. futures slip on rate-hike bets
BNN Bloomberg
Stocks in Europe declined amid disappointing results from large clothing retailers and worries over Credit Suisse Group AG. U.S. equity futures edged lower and short-end Treasury yields rose as sticky inflation supported bets for further Federal Reserve rate hikes.
The two-year Treasury yield — the most sensitive to policy moves — climbed six basis points, adding to Tuesday's 27-point rise, while the 10-year rate dipped four basis points. Contracts on the S&P 500 and Nasdaq 100 fluctuated before turning lower even as a rebound in regional banks continued in premarket trading. A gauge of dollar strength edged higher after four days of declines.
Europe's Stoxx 600 equity benchmark fell more than one per cent, with a gauge of retailers plunging after Zara owner Inditex SA and H&M Hennes & Mauritz AB both flagged slowing sales. Banks declined as shares in Swiss lender Credit Suisse slumped for an eighth straight session after a top shareholder ruled out more assistance. Oil majors also dragged the index lower after this week's steep drop in crude prices.
Swaps pricing is back to positioning for the Fed to lift rates by a quarter percentage point next week after the odds of an increase had slipped to nearly 50-50 on Monday. The closely-watched core consumer price index increased 0.5 per cent in February, slightly ahead of the median estimate of 0.4 per cent and enough to keep pressure on policy makers.
