US Treasury yields remain pressured, S&P 500 Futures drop half a percent on sour sentiment


  • US 10-year Treasury yields seesaw around fortnight low.
  • S&P 500 Futures drop 0.60%, Asia-Pacific shares trade mixed.
  • PBOC announced rate cut, Omicron fears escalate ahead of holiday season.
  • Fed’s Waller renewed rate-hike calls, US Senator Manchin poured cold water on the face of BBB hopes.

Having witnessed a roller-coaster week filled with the central bankers’ actions, global markets stay depressed during early Monday.

While portraying the mood, US 10-year Treasury yields dropped 1.5 basis points (bps) to 1.38%, down for the third consecutive day while S&P 500 Futures drop 0.60% at the latest. Further, Australia’s ASX 200 dropped 0.30% by the press time even as stocks in China traded mixed.

The reason could be linked to the escalating concerns over the covid variant linked to South Africa, namely Omicron, as well as fresh fears of a Fed rate hike in early 2022. Adding to the bearish catalysts is the latest disappointment for the US Democratic Party members after Joe Manchin rejected the push to vote for President Joe Biden’s Build Back Better (BBB) stimulus.

A 52% jump in the UK’s covid cases and fears of fresh covid-linked restrictions during the Christmas celebrations join chatters over a virus-led death of a New Zealand resident who took Pfizer vaccine. Additionally, New York Times said, “Dr. Anthony S. Fauci, the nation’s top infectious disease expert, warned on Sunday that the extraordinarily contagious Omicron variant of the coronavirus was raging worldwide and that it was likely to cause another major surge in the United States, especially among the unvaccinated.”

Elsewhere, US Senator Manchin’s step back rejects odds for any fruitful discussion on the much-awaited US stimulus during 2021 as Democrats needed all the party votes to progress on the BBB. “West Virginia's Joe Manchin appeared to deal a fatal blow to President Joe Biden's signature domestic policy bill, known as Build Back Better, which also aims to expand the social safety net and tackle climate change,” said Reuters.

On the same line were fresh talks over the Fed rate hike in early 2022, triggered on Friday by Fed Board of Governors member Christopher Waller. The policymaker said, per Reuters, “The ‘whole point’ of the Fed's decision to accelerate the pace of its QE taper was to make the March Fed meeting ‘live’ for a first rate-hike.”

Against this backdrop, the US Dollar Index (DXY) struggles around 96.65, after posting the highest daily close in 2021 the previous day. The risk-aversion wave favors gold prices but weighs on the oil at the latest.

It’s worth noting that a light calendar and holiday mood may restrict market moves looking forward.

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Feed news Join Telegram

Recommended content


Recommended content

Editors’ Picks

EUR/USD falls toward 0.9600 amid renewed dollar strength

EUR/USD falls toward 0.9600 amid renewed dollar strength

EUR/USD has turned south and declined toward 0.9600 in the second half of the day on Monday. A sharp decline witnessed in the GBP/USD pair and the souring market mood provided a boost to the dollar, lifting the US Dollar Index back above 114.00. 

EUR/USD News

GBP/USD falls below 1.0700 following BoE statement

GBP/USD falls below 1.0700 following BoE statement

GBP/USD came under renewed bearish pressure and slumped below 1.0700 during the American trading hours. In a statement published on Monday, the Bank of England said that they welcome the government's commitment to sustainable economic growth, triggering another GBP selloff.

GBP/USD News

Gold could soon challenge the $1,600 level

Gold could soon challenge the $1,600 level

Demand for the dollar continued at the beginning of the week, resulting in XAUUSD plummeting to $1,626.67, its lowest since April 2020. Concerns about potential recessions undermined the dismal market’s mood, pushing the greenback higher despite its extreme overbought conditions.

Gold News

Bitcoin: Investors need to prepare for volatile breakout

Bitcoin: Investors need to prepare for volatile breakout

Bitcoin price has been devoid of volatility for the last week and has been in a tight consolidation without directional bias whatsoever. This range bound move has formed a triangle pattern which could break either way. 

Read more

Three stocks that will be in the news this week: Amazon, Nike, Micron Technology

Three stocks that will be in the news this week: Amazon, Nike, Micron Technology

The S&P 500 index lost 4.1% last week and left traders melancholy with another week to go in this dreadful September. The S&P 500 index is down 6.6% so far in the month that is already known for poor performance, and most seem to think the pain will continue. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures