· Bond scares spook world shares, investors look to Powell
Resurgent worries about rising U.S. bond yields hit global shares on Thursday as investors waited to see if Federal Reserve Chair Jerome Powell will address concerns about the risk of a rapid rise in long-term borrowing costs.
The spectre of higher U.S. bond yields also undermined low-yielding, safe-haven assets, such as the yen, the Swiss franc and gold.
Benchmark 10-year U.S. Treasuries rose to 1.477%, heading back towards a one-year high of 1.614% set last week on bets on a strong economic recovery aided by government stimulus and progress in vaccination programmes.
The MSCI’s ex-Japan Asian-Pacific shares lost 1.8% in early trade while Japan’s Nikkei fell 2.2%.
· Japan's Nikkei hits 1-month low as U.S. futures slump
Japan’s Nikkei index on Thursday dropped to its lowest in one month, as investors sold off heavyweights including SoftBank Group and Fast Retailing, tracking a slump in U.S. futures during the Asian trade.
The Nikkei share average closed 2.13% weaker at 28,930.11, the lowest since Feb. 5, while the broader Topix lost 1.04% to 1,884.74.
Resurgent worries about rising U.S. bond yields also hit global shares as investors maintained a cautious stance and awaited to see if Federal Reserve Chair Jerome Powell will address concerns about the risk of a rapid rise in long-term borrowing costs.
E-mini S&P futures slipped 0.45% while the futures for the Nasdaq, the unequivocal leader of the post-pandemic rally, fell 0.74% to a two-month low.
· China blue-chips drop most in over 7 months as consumer, material stocks slump
Chinese shares dropped on Thursday, with the blue-chip index declining the most in more than seven months, as investors dumped consumer and materials stocks on concerns over high valuations.
The Shanghai Composite index was down 2.05% at 3,503.49, while the blue-chip CSI300 index was down 3.15%, its biggest one-day drop since January 2020.
The bluechip’s consumer staples sub-index slid 4.91%, while the material sub-index fell 4.82%.
Tech shares were also sold off during the day, with the start-up board ChiNext Composite index falling 4.87% and Shanghai’s tech-focused STAR50 index down 2.59%.
· U.S. stock futures decline after major averages dip amid rising bond yields
U.S. stock index futures slid in early morning trading on Thursday, accelerating losses from the regular trading session which saw the major averages finish in the red across the board.
Futures contracts tied to the Dow Jones Industrial Average fell 95 points. S&P 500 futures and Nasdaq 100 futures also both traded in negative territory. Earlier, Dow futures had fallen more than 200 points.
Stocks posted heavy losses during regular trading as rising bond yields spooked investors. The S&P 500 dipped 1.3%, while the Dow Jones Industrial Average closed 119 points, or 0.38%, lower. The Nasdaq Composite was the relative underperformer, falling 2.7% as tech names declined. The index is on track to post its third straight negative week — the longest weekly losing streak since September.
· European markets pull back as bond moves wobble global stocks
European markets retreated Thursday morning as a rise in bond yields saw jitters return to global stocks once again.
The pan-European Stoxx 600 shed 0.6% in early trade, with basic resources dropping 3.5% as most sectors slid into the red. Utilities bucked the downward trend to climb 1%.
Reference: CNBC, Reuters
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