S&P 500 Futures rebound from yearly low, yields eye first weekly loss in 10 amid mixed clues

  • Market sentiment dwindles as Fedspeak fails welcome firmer US inflation, China covid updates test optimists.
  • S&P 500 Futures part ways from Wall Street’s losses as Fed’s Bullard refrains from usual hawkish comments.
  • US Treasury yields drop for the fourth consecutive day after refreshing 20-year high.

Global markets remain jittery as traders consolidate recent moves amid a light calendar and mixed comments from the Fed policymakers, not to forget moving beyond the higher US inflation data, during Thursday’s Asian session.

While portraying the mood, the US 10-year Treasury yields dropped 1.4 basis points (bps) to 2.92%, around a two-week low by the press time. In doing so, the benchmark bond coupon drops for the fourth consecutive day, bracing for the first negative week in 10. Elsewhere, S&P 500 Futures rise 0.30% intraday gains, in contrast to Wall Street’s losses.

It’s worth noting that an absence of hawkish comments from the Fed seems to stop USD bulls from cheering upbeat inflation data. That said, the US Consumer Price Index (CPI) rose to 8.3% YoY versus 8.1% expected and 8.5% prior. More importantly, the CPI ex Food & Energy, better known as Core CPI, crossed 6.0% forecasts with 6.2% annual figures, versus 6.5% previous readouts. Following the data, during early Thursday in Asia, the previously hawkish Federal Reserve Bank of St. Louis James Bullard mentioned that he ''won't emphasize single inflation report too much but inflation is more persistent than many have thought.''

Elsewhere, contrasting signals concerning the covid conditions in China also seem to trouble the risk-takers even as softer yields allow stock futures to print mild gains. While stating the fact, the recent coronavirus figures from Shanghai and mainland China ease but the community cases seem to keep the lockdowns intact.

Additionally, Europe’s readiness for the sixth round of sanctions on Russia and Brexit headlines are other catalysts that weigh on the market sentiment, keeping it hard for the bulls to enter.

Moving on, weekly prints of the US Jobless Claims and monthly Producer Price Index (PPI) will decorate today’s calendar but major attention will be given to the qualitative catalysts, like Brexit, covid and geopolitics, for clear directions.

Also read: From flation to stag & back

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