(Bloomberg) — Nasdaq 100 futures climbed Tuesday after an overnight slump in technology stocks and Asian shares erased losses as Chinese state-backed funds intervened to alleviate domestic declines. Treasury yields fell.
China’s CSI 300 equity gauge plunged more than 3% before bouncing back after state-related funds stepped in to ensure market stability. Nasdaq 100 contracts outperformed as U.S. futures rallied. The tech gauge tumbled Monday and is now down 11% from a February record. The S&P 500 shed intraday gains as the retreat in high-valuation stocks offset a rise in financial and materials shares.
Elsewhere, the yen weakened beyond 109 per dollar for the first time since June. The 10-year Treasury yield slipped further below 1.6%, with investors watching upcoming auctions to assess the outlook. Asian credit markets slumped as more deals were scrapped on concerns about a spike in rates.
Investors are continuing to shift from costlier growth stocks, such as tech shares, into value and cyclical segments to tap the expected stimulus-fueled recovery from the pandemic. At the same time, price pressures and rising long-term borrowing costs loom as threats for equities generally, after a prolonged period in which ultra-low rates helped lift markets.
“We do believe that at this point we will see gyrations just because the market is pricing in quite a lot of positive news,” said Jun Bei Liu, a portfolio manager at Tribeca Investment Partners. Bond yields are only starting to normalize and the 10-year Treasury yield won’t climb to 2% quickly, she added.
Elsewhere, oil edged higher in Asian trading with the market turning its focus back to the robust outlook. Bitcoin breached the $54,000 level, hitting a two-week high on more signs of institutional interest.
Here are some key events to watch:
EIA crude oil inventory report is due WednesdayThe U.S. February consumer price index will offer the latest look at price pressures Wednesday.The U.S. government auctions 3-, 10- and 30-year Treasuries this week.The European Central Bank holds its monetary policy meeting and President Christine Lagarde is set to do a briefing Thursday.
Stocks
S&P 500 futures rose 0.8% as of 6:12 a.m. in London. Nasdaq 100 contracts were up 1.1%. The S&P 500 fell 0.5%.Japan’s Topix index rose 1.3%.Australia’s S&P/ASX 200 Index added 0.5%.South Korea’s Kospi index fell 0.4%.Hong Kong’s Hang Seng Index added 0.9%.China’s CSI 300 Index fell 0.9%.Euro Stoxx 50 futures were little changed.
Currencies
The yen traded at 109.16 per dollar, down 0.3%.The offshore yuan was at 6.5369 per dollar, up 0.2%.The Bloomberg Dollar Spot Index fell 0.1%.The euro traded at $1.1860, climbing 0.1%,
Bonds
The yield on 10-year Treasuries fell about two basis points to 1.57%.Australia’s 10-year bond yield was at 1.78%.
Commodities
West Texas Intermediate was at $65.07 a barrel.Gold added 0.4% to $1,690.51 an ounce.
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