Futures drop as dollar, bonds rise on haven demand
BNN Bloomberg
US equity futures fell Tuesday as the dollar and sovereign bonds rose, a pattern highlighting pervasive unease about the economic outlook amid high inflation and China’s struggles with COVID.
S&P 500, Nasdaq 100 shed over 0.5 per cent after a Wall Street slide Monday. The Stoxx Europe 600 gauge slipped for a second day, though it pared the decline with utilities outperforming as EDF jumped after a report that the French government will pay a premium to take control of the electricity company. An Asian share index headed for its biggest two-day drop in a month.
The dollar pushed toward levels last seen at the height of the 2020 market panic over COVID and the yen strengthened, underlining investor caution. The euro-area’s common currency, meanwhile, is within a whisker of parity with the greenback, sapped by the region’s energy crisis and acute recession fears.
Treasuries extended gains, taking the US 10-year yield to 2.92 per cent. Bonds also rallied in Europe. German bonds surged, sending the benchmark 10-year yield to the lowest since May, after data showed investor confidence plunged to a 2011 low.
