Stocks were mixed on Thursday as investors switched their focus from monetary policy back to company earnings and the outlook for global trade. Treasuries retreated.
U.S. equity futures advanced after the three main gauges fell on Wednesday, when the Federal Reserve pushed back on market expectations that its next move would be a rate cut. The Stoxx Europe 600 declined, with most of the region’s national benchmarks slipping as they reopened following a holiday. Corporate results were mixed, with oil giant Shell beating estimates and Lloyds Bank missing.
Most government bonds in Europe initially tracked the slide in Treasuries, though they reversed declines to edge higher after data showed the euro area’s manufacturing slump extended into a third month. The pound nudged lower even as the Bank of England held rates steady and hinted at future hikes.
In Asia, trading was again depressed by holidays in Japan and China. Equity benchmarks in South Korea and Hong Kong hit their highs of the session after CNBC reported that the U.S. and China could announce a trade deal as soon as next Friday, citing sources it didn’t name.
Alongside the earnings season, the chances of a breakthrough in the trade talks are back on top of the agenda, with negotiations between the U.S. and China set to continue in Washington next week. For now, markets appear to be stabilizing in the wake of the Fed decision and press conference, which triggered stock declines and marginal gains for the dollar that suggested some investors had anticipated a more dovish message from Jerome Powell and his colleagues.
The next big clue on the health of the world’s biggest economy will be Friday’s monthly U.S. jobs report.
Elsewhere, oil extended declines in the wake of a report showing U.S. crude stockpiles swelled to their highest levels since 2017. A gauge of emerging-market stocks edged higher for a second day.
Here are some notable events this week:
- Companies reporting earnings include: HSBC and Macquarie.
- Friday brings the U.S. jobs report: non-farm payrolls are projected to rise by about 190,000 in April. Economists expect an unemployment rate of 3.8 percent, with average hourly earnings growth picking up to 3.3 percent.
These are the main moves in markets:
Stocks
- The Stoxx Europe 600 Index dipped 0.3 percent as of 12:08 p.m. London time, the lowest in more than two weeks on the largest decrease in more than three weeks.
- Futures on the S&P 500 Index climbed 0.2 percent.
- The U.K.’s FTSE 100 Index declined less than 0.05 percent to the lowest in a month.
- The MSCI Emerging Market Index rose 0.1 percent.
Currencies
- The Bloomberg Dollar Spot Index gained 0.1 percent.
- The euro climbed 0.1 percent to $1.1205.
- The British pound fell 0.1 percent to $1.304, the first retreat in a week and the largest fall in more than a week.
- The Japanese yen fell 0.1 percent to 111.50 per dollar, the biggest fall in more than a week.
Bonds
- The yield on 10-year Treasuries jumped two basis points to 2.52 percent.
- Germany’s 10-year yield fell less than one basis point to 0.01 percent.
- Britain’s 10-year yield decreased less than one basis point to 1.145 percent.
- Japan’s 10-year yield was unchanged at -0.04 percent.
Commodities
- West Texas Intermediate crude decreased 1.1 percent to $62.93 a barrel, the lowest in four weeks.
- Copper declined 0.1 percent to $2.80 a pound, the lowest in 11 weeks.
- Gold fell 0.4 percent to $1,271.39 an ounce, the weakest in more than four months.
