Futures for US stock indexes and European stocks fell on fears that the continuation of the fight against inflation by central banks will lead to a recession in the economy.
Contracts for the S&P 500 and Nasdaq 100 are down 1%, while the underlying indices have fallen the most since Nov. 2. The Stoxx 600 index in Europe has fallen to a lower monthly level. The dollar lost some, and Treasuries fell on a curve. Oil stopped the weekly gain.
The index of world stocks also began to go down, as the Federal Reserve and the European Central Bank do not plan to cut interest rates until inflation returns to their targets. This situation is at odds with market expectations for a lower peak rate and potential rate cuts in 2023. Economists now see a 60 percent chance of a recession in the US and an 80 percent chance in Europe.
Europe’s stock benchmark was also not up because of the retail, consumer goods, and media sectors. The benchmark for Asian stocks fell for the first time since October. The MSCI ACWI Index, a global stock indicator, fell 1.3%.
Learn how to trade stocks with Top Forex and CFD brokers
Treasuries have gone down and the yield curve has become steeper. The 2-year rate gained 1 basis point and the 10-year yield rose 3 basis points. In Europe, British and German bonds lost after ECB President Christine Lagarde issued a statement that discouraged markets from betting on slowing rates.
Traders looked at poor US retail sales and manufacturing data, although the labor market remained strong. The dollar stops falling on Friday, although it may still fall slightly.
Oil lost on Friday, halting a big weekly gain since early October amid signs of supply contraction and prospects for improved demand in China.
Stoxx Europe 600 lost 0.8%
S&P 500 futures fell 1%
Nasdaq 100 futures fell 1%
Dow Jones Industrials futures lost 0.8%
The MSCI Asia Pacific index fell 0.6%.
The MSCI Emerging Markets Index fell 0.3%.
The euro added 0.2% to $1.0647.
The Japanese yen went up 0.5% to 137.06 per dollar.
The offshore yuan rose 0.2% to 6.9767 per dollar.
The British pound remains at $1.2173.
Bitcoin added 0.2% to $17,439.58.
Ether was up 0.7% to $1273.41.
The 10-year Treasury yield is up three basis points to 3.48%.
The yield on German 10-year bonds added 10 basis points to 2.18%.
The yield on British 10-year bonds rose by seven basis points to 3.31%.
Brent crude fell 1.2% to $80.21 a barrel.
Spot gold has barely changed
Subscribe for our newsletter
Get Forex brokers reviews, market insights, expert analytics and education material right into your inbox for free!