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Stocks, US futures slide amid China, delta risks: markets wrap

(Bloomberg) – US stock futures and Asian stocks fell on Monday as the Delta Virus strain hinders economic reopening and traders await key Chinese data that could signal slower growth.

Stocks fell in Japan with smaller declines in Australia. S&P 500 and Nasdaq 100 contracts fell. US stocks held out another high on Friday, but a decline in consumer sentiment to a low of nearly a decade left some caution, depressing government bond yields and the dollar that held those losses in Asian trading.

China’s retail sales and industrial production numbers could show a slowdown in growth in July due to flooding and mobility restrictions to combat a virus outbreak. Beijing’s regulatory crackdown on private industry has already unsettled the markets, and there is speculation that officials may ease monetary policy further.

Investors are also following Afghanistan’s fall to the Taliban and the potential impact on President Joe Biden, while Congress is alarmed that the country may reappear as a threat to US national security. Biden’s economic agenda is already facing legislative obstacles after some House Democrats threatened to withhold support from a $ 3.5 trillion budget plan until a bipartisan infrastructure package goes into effect.

Stocks in the US and Europe hit all-time highs last week, helped by the introduction of vaccines and continued support for stimulus programs. But the rapidly expanding delta variant and inflationary pressures remain risks. The virus weighs more heavily on Asia as the region struggles to speed up vaccinations. Covid-19 cases have been on or near records in Thailand, Vietnam, and the Philippines.

Traders will also be listening to the latest minutes from the Federal Reserve Open Market Committee and a speech by Federal Reserve Chairman Jerome Powell this week for further guidance on the likely timetable for a $ 120 billion reduction in monthly bond purchases by the central bank to obtain.

“Markets will have to get used to a potential Fed throttling sometime next year,” Macquarie Private Bank’s Martin Lakos told Bloomberg Television.

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Elsewhere, Bitcoin was trading at around $ 47,500 and the total market value of cryptocurrencies was back over $ 2 trillion. Crude oil slipped.

In other political developments, Canadian Prime Minister Justin Trudeau called elections for September 20 and Malaysia’s Prime Minister Muhyiddin Yassin told his party that he would resign on Monday.

Here are some events to watch this week:

China released July industrial production, retail sales data on Monday Federal Reserve Chairman Jerome Powell to host a discussion at City Hall on Tuesday with educators Retail sales are due on Tuesday, the Reserve Bank of Australia minutes are expected to be released on Tuesday

For more market analysis, check out our MLIV blog.

These are the main moves in the markets:

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S&P 500 futures fell 0.3% at 9:31 a.m. in Tokyo. The S&P 500 rose 0.2% on Friday. Nasdaq 100 futures slipped 0.2%. Nasdaq 100 rose 0.3% Japan’s Topix index fell 1.5% Australia’s S & P / ASX 200 index lost 0.3% Hang Seng index futures previously rose 0.1%

Currencies

The Japanese yen was trading at 109.53 per dollar; the offshore yuan was trading at 6.4795 per dollar; the Bloomberg Dollar Spot Index was up 0.1%; the euro was trading at 1.1794 dollars

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10-year government bond yields fell 1 basis point to 1.27% Australia’s 10-year bond yield fell 5 basis points to 1.17%

raw materials

West Texas Intermediate crude oil fell 1% to $ 67.79 a barrel of gold, which was $ 1,779.08 an ounce

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