Global stock markets fluctuated in anticipation of US inflation data due out on Friday, with S&P 500 futures moving in different directions, European contracts rising and major Asian stocks falling.
An index showing the US dollar against a basket of six other major currencies was almost unchanged, and the yen cut weekly gains as the Bank of Japan adjusted its yield curve control.
Treasury bond yields rose, along with Australian and New Zealand government bond yields. The underlying yield on Japan’s 10-year bonds fell to 0.37%, below the Bank of Japan’s new upper limit of 0.5%.
Stock exchanges in Asia experienced negative sentiment with declines driven by technology stocks listed on the Hong Kong stock exchange. The core indices of Japan, Australia, and South Korea were also weak.
Thursday’s US session, which saw US tech stocks tumble, and new economic data confirming views that the Federal Reserve will continue to raise interest rates, set negative sentiment.
Initial jobless claims for the week ended Dec. 17 rose less than expected, indicative of the strength of the labor market, according to US data. Gross domestic product in the third quarter was revised up to 3.2% due to tighter spending.
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On Friday, traders and investors will be focused on the core PCE deflator, which is the Fed’s key inflation indicator.
At the same time, there is a possibility that Japanese investors could return several trillion dollars to their country, which they invested in foreign stocks and bonds, as the yields of the yen and local bonds rose due to the hawkish policy of the Bank of Japan.
Meanwhile, oil rose well for the week as Russia said it could cut crude oil production in response to a price ceiling imposed by the G7 on its exports.
S&P 500 closes 1.5% lower
The Nasdaq 100 is down 2.5%.
Japanese Topix fell 0.5%
The Hong Kong Hang Seng fell 0.7%.
The Shanghai Composite fell 0.6%.
Euro Stoxx 50 futures are up 0.4%
The euro changed slightly at $1.0603.
The Japanese yen fell 0.3% to 132.70 per dollar.
The offshore yuan added 0.2% to 6.9945 per dollar.
The British pound was almost unchanged at $1.2031.
Bitcoin rose 0.1% to $16810.88.
Ether rose 0.4% to $1219.81.
The 10-year Treasury yield rose one basis point to 3.69%.
The yield on 10-year Australian bonds rose three basis points to 3.83%.
West Texas Intermediate crude oil rose 0.9% to $78.15 a barrel.
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