(Bloomberg) — U.S. and European futures rose Thursday as investors weighed an American agreement to avoid a government shutdown. The dollar and Treasuries slipped.
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Asian stocks were mixed amid weak Chinese data. Japanese shares slipped as the ruling party’s new leader, who is set to become the next prime minister, is seen by investors as maintaining stability. China edged up ahead of a week-long holiday, while Hong Kong fell.
Senate Majority Leader Chuck Schumer said Wednesday lawmakers had reached an agreement to avoid a government shutdown on Friday, extending government spending until Dec. 3. Earlier, Federal Reserve Chair Jerome Powell and his counterparts in Japan, Europe and the U.K. voiced cautious optimism that supply-chain disruptions lifting inflation rates around the world would ultimately prove temporary.
China’s factory activity contracted in September for the first time since the pandemic began last year, a sign of the damage a widespread electricity crunch is having on an already slowing economy.
Investors are finishing the third quarter concerned about global growth amid inflationary pressures, a looming energy crisis, supply chain bottlenecks and regulatory risks emanating from China. A majority harbor fears of persistently high inflation, with a 20% pullback in stocks seen as more likely than a 20% rally, according to a Citigroup Inc. survey of clients. Global stocks are poised to decline for the first quarter in six.
“Asian equities are under minor pressure, while developed ones are outperforming a tad,” said Sebastien Galy, a strategist at Nordea Investment Funds. “It is a testament to the dichotomy of reality between an ebullient West and a more realistic Asia Pacific that should over time intensify. Asia is more keenly aware that the large supply shock linked to a reduction in electricity/coal supply issues is traveling along the supply chain.”
Meanwhile, Chinese authorities appeared to remain committed to stabilizing the rapidly cooling housing market, another signal they want to avoid any fallout from the debt crisis at China Evergrande Group. Separately, two holders of an Evergrande dollar bond with a coupon due Wednesday said they hadn’t received payment.
Elsewhere, oil was little changed after declining and Bitcoin jumped to above $43,000.
Here are some events to watch this week:
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House Financial Services Committee hearing on the Fed, Treasury’s pandemic response, Thursday
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Univ. of Michigan sentiment, ISM manufacturing, U.S. construction spending, spending/personal income, Friday
For more market analysis, read our MLIV blog.
Some of the main moves in markets:
Stocks
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S&P 500 futures rose 0.8% as of 7:30 a.m. in London. The S&P 500 rose 0.2%
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Nasdaq 100 futures rose 0.8%. The Nasdaq 100 fell 0.1%
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Topix index fell 0.4%
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Australia’s S&P/ASX 200 Index rose 1.9%
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Kospi index rose 0.3%
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Hang Seng Index fell 0.3%
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Shanghai Composite Index rose 0.9%
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Euro Stoxx 50 futures gained 0.8%
Currencies
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The Japanese yen was at 111.94 per dollar
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The offshore yuan traded at 6.4717 per dollar
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The Bloomberg Dollar Spot Index dipped 0.1%. It climbed 0.7% earlier
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The euro was at $1.1599
Bonds
Commodities
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West Texas Intermediate crude was at $74.90 a barrel, up 0.1%
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Gold was at $1,728.92 an ounce, up 0.2%
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