Futures drift with Asian stocks; dollar retreats: markets wrap

Asian stocks and US futures drifted Tuesday after the S&P 500 Index failed at another attempt to break a record high amid an impasse over US stimulus measures. The dollar dipped and Treasuries climbed.

South Korean stocks underperformed, sinking more than 2%, as the prime minister prepares for a national address amid a surge in coronavirus cases. Stocks were little changed in Japan, Hong Kong and Shanghai. They rose in Sydney. S&P 500 futures fluctuated while European ones fell. The US benchmark again ended below its February closing record despite rising past that level during trading. Ten-year Treasury yields ticked lower. The offshore yuan reached the strongest level since early March.

While a cash injection by China’s central bank Monday buoyed investors, tension between Washington and Beijing continues to weigh on sentiment, with the US announcing new restrictions on Huawei Technologies Co. Taiwan’s MediaTek Inc. led a slump among Asian chipmakers following the move.

The S&P 500 is struggling to cement a fresh record, amid deadlock in the US over additional fiscal stimulus and the ongoing deterioration in US-China ties. The Commerce Department announced further restrictions on Huawei aimed at cutting the Chinese company’s access to commercially available chips.

“A lot of investment professionals as well as retail investors are on the sidelines partially because they are waiting for this second stimulus package,” Erin Gibbs, president and chief investment officer at Gibbs Wealth Management, said on Bloomberg TV. “It’s not a full-on risk on environment just yet.”

Elsewhere, oil slipped from a five-month high and gold gained.

Stocks

• S&P 500 futures were little changed as of 7 a.m. in London. The benchmark index rose 0.3%.
• Topix index rose less than 0.1%.
• Australia’s S&P/ASX 200 Index gained 0.7%.
• South Korea’s Kospi index fell 2.4%.
• Hong Kong’s Hang Seng Index fell 0.1%.
• Shanghai Composite Index rose 0.2%.
• Euro Stoxx 50 futures fell 0.3%.

Currencies

• The yen rose 0.4% to 105.62 per dollar.
• The offshore yuan was at 6.9256 per dollar, up 0.1%.
• The Bloomberg Dollar Spot Index fell 0.2%.
• The euro rose 0.2% to $1.1893.

Bonds

• The yield on 10-year Treasuries dipped two basis points to 0.67%.
• Australia’s 10-year bond yield fell three basis points to 0.87%.

Commodities

• West Texas Intermediate crude fell 0.5% to $42.69 a barrel.
• Gold rose 0.6% to $1,997.80 an ounce.

© 2020 Bloomberg