Stocks fall, Futures Waver on Growth, China Risks: Markets Wrap

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Stocks fall, Futures Waver on Growth, China Risks: Markets Wrap

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(Bloomberg)-13/9/2021

Stocks fell and U.S. futures wavered Monday as the risk of a slower recovery from the pandemic shadowed global markets and Chinese technology stocks buckled under Beijing’s regulatory clampdown. A Hong Kong gauge of Chinese tech names tumbled after a report that officials are seeking to break up Ant Group Co.’s Alipay. China’s online platforms have also been told to protect the rights of workers in the so-called gig economy. MSCI Inc.’s Asia-Pacific index retreated for the third time in four sessions. European futures were little changed and U.S. contracts struggled to make gains amid caution over reopening challenges from the delta virus strain. Oil rose to about $70 a barrel and aluminum rallied. Commodity markets are having a tough time balancing strong demand with sticky supply, Goldman Sachs Group Inc. said. Treasury yields pared an advance as traders assess price pressures and their impact on the likely timeline for a reduction in Federal Reserve stimulus. An update on U.S. consumer prices this week will feed into the debate about whether elevated costs are transient. The dollar pushed higher. The ongoing march of Covid-19 even as vaccine rollouts accelerate is undermining confidence in the economic recovery and contributing to supply snarls that are stoking inflation. Key central banks are also getting closer to paring pandemic-era stimulus, posing risks for financial markets. “Risk assets will continue to struggle in the near term with weak hard data due to the delta outbreak and supply disruptions over the summer,” Barclays Plc. strategists including Shinichiro Kadota wrote in a note. But the Barclays team said it is wary of turning too bearish as progress toward containing the virus will likely eventually bolster growth prospects. Meanwhile, President Joe Biden’s $3.5 trillion tax-and-spending plan faces challenges. Democrat Senator Joe Manchin has cast doubt on the timeline for pushing Biden’s economic agenda through Congress, and proposed tax rates may be watered down to boost the chances of the package being passed. In the latest tapering comments, Federal Reserve Bank of Philadelphia President Patrick Harker said he’s supportive of moving toward a tapering process “sooner rather than later,” according to a report. Elsewhere, North Korea ratcheted up tensions on the Korean Peninsula with a missile test. The won was the weakest performer in an Asian basket. Traders were also monitoring the latest Covid-19 outbreak in China. In key company news, Epic Games Inc. filed a notice of appeal in its closely watched antitrust lawsuit against Apple Inc. OPEC monthly oil market report, Monday U.S. consumer-price index, Tuesday Apple product-launch event, Tuesday China retail sales, property prices, industrial production, Wednesday Quadruple witching day for U.S. markets, Friday S&P 500 futures rose 0.2% as of 7 a.m. in London. The S&P 500 fell 0.8% Friday Nasdaq 100 contracts were little changed. The Nasdaq 100 fell 0.8%Japan’s Topix index rose 0.3%Australia’s S&P/ASX 200 Index rose 0.1%South Korea’s Kospi fell 0.3%Hong Kong’s Hang Seng Index lost 2.3%China’s Shanghai Composite Index rose 0.1%Euro Stoxx 50 futures were steady