Asia Stocks to Drop After U.S. Fall; Bonds Rise: Markets Wrap

Stocks in Asia were poised to follow U.S. equities lower after an unexpected rise in jobless claims rekindled concern the economic recovery has stalled. Treasuries rose.

Futures slid in Hong Kong and Australia. Earlier, the S&P 500 Index slipped from a four-month high, led by losses in technology firms and companies that make non-essential consumer goods. The Nasdaq 100 Index dropped to a two-week low and turned lower for the week, erasing Monday’s rally. Intel Corp. slumped in after-hours trading after warning about a production delay.

The first uptick in jobless claims since March comes as Congress negotiates a new relief package for millions of Americans who are set to lose enhanced benefits at the end of the month. Other worrying signs of the U.S. economy slowing added to concern that the growth in some areas will peter out.

“The recovery is in place, but the labor market is really, really fragile,” said Gene Goldman, chief investment officer at Cetera Financial Group. “That’s going to weigh on the markets and it’s going to weigh on consumers for a long time.”

Elsewhere, the yield on 10-year Treasuries fell to 0.58%. Crude slumped, while precious metals continued their torrid run of gains that have taken gold and silver prices to multi-year highs.

In Europe, the yield on Italy’s benchmark bonds fell below 1% for the first time since March amid euphoria over the Europe Union’s pandemic recovery package.

Japan remains closed for a holiday Friday.

These are the main moves in markets:

Stocks

  • The S&P 500 Index fell 1.2% on Thursday.
  • Futures on Hong Kong’s Hang Seng Index declined 1.1%.
  • Futures on Australia’s S&P/ASX 200 Index slipped 0.9%.

Currencies

  • The yen was at 106.87 per dollar.
  • The offshore yuan held at 7.0115 per dollar.
  • The euro bought $1.1595.

Bonds

  • The yield on 10-year Treasuries fell two basis points to 0.58%.

Commodities

  • West Texas Intermediate crude oil dropped 2% to $41.07 a barrel.
  • Gold gained 0.9% to $1,887.48 an ounce.

— With assistance by Vildana Hajric, Claire Ballentine, and Sophie Caronello

Source: Read Full Article