(Bloomberg) — Asian stocks fell Monday and US equity futures erased a climb as tightening monetary policy kept sentiment in check.
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MSCI Inc.’s gauge of Asia-Pacific shares hit the lowest since June 2020 amid drops in Japan and Hong Kong and mixed performance in China, where banks kept their main lending rates unchanged.
S&P 500 contracts turned lower, while those for the Nadsaq 100 reversed a gain of more than 1%.
Bitcoin slid anew, sinking back below the closely-watched $20,000 mark. A volatile crypto slump has become emblematic of the pressure on a range of assets from sharp Federal Reserve interest-rate hikes to tame high inflation.
The dollar was mixed against key peers. Crude oil added to a near-7% Friday plunge. Treasury futures advanced — there’s no cash trading as Wall Street is closed Monday for a holiday.
Markets are set to remain on edge amid elevated price pressures and concern that monetary tightening in a range of nations portends more losses.
“Data over the coming months will indeed point to the need for a greater degree of tightening, and market prices will need to adjust,” Sonal Desai, chief investment officer at Franklin Templeton Fixed Income, wrote in a note.
In the latest Fed commentary, Governor Christopher Waller said he would support another 75-basis-point rate increase at the central bank’s July meeting should economic data come in as he expects.
Bank of Cleveland Fed President Loretta Mester said the risk of a US recession is increasing, adding it will take several years to return to the 2% inflation goal. Fed Chair Jerome Powell is due to appear before US lawmakers this week.
What to watch this week:
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China loan prime rates, Monday
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RBA minutes, Governor Philip Lowe due to speak, Tuesday
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Fed Chair Jerome Powell semi-annual Senate testimony, Wednesday
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Bank of Japan April minutes, Wednesday
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Powell US House testimony, Thursday
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US initial jobless claims, Thursday
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PMIs for Eurozone, France, Germany, UK, Australia, Thursday
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ECB economic bulletin, Thursday
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US University of Michigan consumer sentiment, Friday
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RBA’s Lowe speaks on panel, Friday
Some of the main moves in markets:
Stocks
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S&P 500 futures fell 0.1% as of 10:48 a.m. in Tokyo. The S&P 500 rose 0.2% Friday
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Nasdaq 100 futures rose 0.1%. The Nasdaq 100 rose 1.2% Friday
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Japan’s Topix index fell 1.1%
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Australia’s S&P/ASX 200 index fell 0.6%
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South Korea’s Kospi fell 2.3%
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Hang Seng Index fell 0.4%
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Shanghai Composite Index was little changed
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Euro Stoxx 50 futures fell 0.4%
Currencies
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The Bloomberg Dollar Spot Index was steady
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The euro was at $1.0496
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The Japanese yen was at 135.07 per dollar
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The offshore yuan was at 6.7088 per dollar
Bonds
Commodities
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West Texas Intermediate crude fell 0.5% to $109.03 a barrel
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Gold was at $1,839.61 an ounce
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