S&P 500 Futures drop over 1.0%, off two-month top, amid trade war fears

  • S&P Futures drops as US-China trade war fears join coronavirus worries.
  • Downbeat US data, a lack of virus cure and no strong sign of economy restart add to the risk-off sentiment.
  • Second-tier US data will decorate the economic calendar, qualitative catalysts remain as the major drivers.

While stepping back from the highest since March 06, S&P 500 Futures drop 30 points to 3,872, down 1.10% on a day, during the Asian session on Friday.

The Futures linked to the US equity benchmark suggest the risk-off is gaining momentum after US President Donald Trump renewed US-China trade war fears. The Republican leader earlier mentioned that the US trade deal with China has been “upset very badly” by the coronavirus while his latest threats to use tariffs were harsh on the trade sentiment.

Also weighing on the market’s risk-tone could be NIKKEI forecast suggesting Japan’s GDP to recall World War II levels as well as signs of lockdown extension from the Asian nation.

Earlier, the ECB failed to take a bold move despite showing concerns over the coronavirus (COVID-19) carnage. On the economic front, Eurozone GDP and the US Jobless Claims, together with the Chicago Fed Manufacturing Index, flashed downbeat figures and added strength to the risk aversion. It’s worth mentioning that Wall Street benchmarks closed the April month on a negative side with near 1.0% losses on Thursday.

Amid all these plays, US 10-year Treasury yields seesaw around 0.63% whereas Japan’s NIKKEI begins the day with over 1.30% loss while declining below 19,900.

Given the fresh trade-war fears adding to the market’s worries, a light economic calendar in Asia will keep news/updates on the virus/trade on the driver’s seat.

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