US futures fall as growth fears dent stock bounce: markets wrap

US equity futures fell Friday and Asian stocks wavered after disappointment over technology earnings stoked worries about the economic outlook and took some of the shine off this week’s global equity rebound.

An Asian share index edged up in listless performance across the region after a China tech jump fizzled. Nasdaq 100 contracts came close to shedding 1% while European futures fluctuated.

The downbeat mood in stocks followed a drop of about 27% in social-media firm Snap Inc. in extended trading on poor results that flagged worries about an advertising and wider economic slowdown.

The plunge weighed on Facebook parent Meta Platforms Inc. and Google’s Alphabet Inc., overshadowing the best three-day S&P 500 gain since late May.

Treasuries trimmed a surge from the Wall Street session but the 10-year yield is still below 3%. Rising US jobless claims, a dimming regional factory outlook and a weaker leading economic indicator signaled recession risks amid tightening monetary policy, bolstering demand for bonds.

Traders are also watching President Joe Biden’s condition after he tested positive for Covid and showed mild symptoms.

Global stocks remain on course for their best week in a month, paring this year’s equity market rout to about 18%. Speculation that the worst of the selloff has passed is partly behind the move.

But angst about the damage from high inflation and rapidly rising interest rates is proving hard to shake — despite a tempering in expectations of just how aggressive the Federal Reserve will be. A dollar gauge pushed higher in a sign of caution.

“I would point out that we have a lot of earnings to come next week, we have the Fed meeting next week,” Susquehanna International Group derivatives strategist Chris Murphy said on Bloomberg Television. “I don’t necessarily think we’re totally out of the woods yet.”

Euro falls

Meanwhile, the euro unwound an advance sparked by the European Central Bank’s 50 basis-point interest-rate hike, the first increase in 11 years.

The monetary authority is tackling elevated price pressures but faces a slew risks. Concerns linger that Russia could choke European gas supplies in the fallout from President Vladimir Putin’s war in Ukraine. In Italy, a political crisis poses an added complication for the region.

“The EU’s biggest challenge this winter is to ensure sufficient gas reserves to get through peak demand for heating and power,” Silvia Dall’Angelo, senior economist at Federated Hermes Ltd., said in emailed comments.

Elsewhere, crude scaled $97 a barrel, while gold and Bitcoin slipped.

Some of the main moves in markets:

Stocks

• S&P 500 futures fell 0.4% as of 5:55 a.m. in London. The S&P 500 rose 1%.
• Nasdaq 100 futures fell 0.8%. The Nasdaq 100 rose 1.4%
• Japan’s Topix index added 0.4%
• Australia’s S&P/ASX 200 index rose 0.1%
• South Korea’s Kospi index lost 0.4%
• China’s Shanghai Composite index fell 0.3%
• Hong Kong’s Hang Seng index increased 0.1%
• Euro Stoxx 50 futures were up 0.1%

Currencies

• The Bloomberg Dollar Spot Index rose 0.2%
• The euro was at $1.0184, down 0.5%
• The Japanese yen was at 137.86 per dollar, down 0.4%
• The offshore yuan was at 6.7766 per dollar, down 0.1%

Bonds

• The yield on 10-year Treasuries rose one basis point to 2.89%
• Australia’s 10-year yield fell 14 basis points to 3.44%

Commodities

• West Texas Intermediate crude was at $97.26 a barrel, up 1%
• Gold was at $1 713.75 an ounce, down 0.3%