August 29, 2022
US Futures Sink, Treasuries Fall on Policy Outlook: Markets Wrap
US equity futures declined along with stocks in Europe after policy makers from the world’s biggest central banks reaffirmed they will follow through with higher interest rates even as economies come under strain. Treasury yields rose.
Contracts on the S&P 500 and Nasdaq 100 retreated, with the latter underperforming after the tech-heavy gauge slumped the most in more than two months on Friday. A global share index fell to a one-month low and European stocks extended last week’s drop, with the rates-sensitive technology sector leading a broad-based decline.
ECB Sets Stage for Another Big Hike With Jumbo Move Possible
The European Central Bank is prepared to at least repeat the half-point increase in interest rates it delivered last month, with an even bigger move not to be excluded as inflation nears yet another record.
That’s the message from ECB officials who joined the Federal Reserve’s annual Jackson Hole symposium, which wrapped up Saturday. Fed Chair Jerome Powell set the tone, saying US borrowing costs are headed higher and will stay there “for some time.”
Asian Stocks Approach Two-Year Low as Powell Spurs Risk-Off Mood
Asian stocks tumbled, with the regional benchmark approaching a two-year low reached mid-July, as investors fled risk assets after the Federal Reserve signaled it will keep raising interest rates to rein in inflation.
The MSCI Asia Pacific Index slumped as much as 2.3%, the most since June 13, with technology, financials and industrials the worst-performing sectors. Key equity gauges in Japan and Taiwan led regional losses, sliding more than 2% each.
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