U.S. Futures Fluctuate as Treasuries Turn Higher: Markets Wrap

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(Bloomberg) — U.S. equity-index futures fluctuated on Tuesday while Europe shares extended losses as investors weighed the latest coronavirus developments after a selloff wiped out global equity gains for this year. Treasuries turned higher and the dollar erased a drop.Contracts on all three major American indexes surrendered much of their early advances as a tentative risk-on mood weakened on news that reported cases of infections and deaths continued climbing outside of China and countries including the U.S. issued travel warnings. Declines in carmakers and banks dragged the Stoxx Europe 600 index lower. Ten-year Treasury yields headed toward a record-low close, while European bonds were mixed, with core yields falling. Crude oil held Monday’s slide of nearly 4%.Japanese shares tumbled more than 3% as traders returned after a holiday, though the decline was less than the two-session slide on Wall Street while they were away. Stocks fell in China and Australia and pushed higher in South Korea and Hong Kong. The yen strengthened against the dollar for a third day.Erratic market moves suggest investors remain on edge over the economic impact of the virus. The World Health Organization has held off from declaring a global pandemic even as cases surged in South Korea, Italy and Japan. Some traders may be taking encouragement from news about the development of treatments, even if experts warn it would take time to build stocks of medicines. Japan’s health minister said the country plans to recommend Fujifilm Holdings Corp.’s Avigan drug to treat the virus.Meanwhile, Mastercard Inc. and United Airlines Holdings Inc. emerged as the latest companies to warn that profits are getting hurt as the disease spreads beyond its center in China’s Hubei province. Analysts at Oxford Economics Ltd. said the epidemic could wipe more than $1 trillion from global domestic product, while the International Monetary Fund lowered its growth forecasts for the world economy.“The market is flying blind with this virus and how things play out from here,” said Peter Boockvar, chief investment office at Bleakley Financial Group. “The only two certainties is that the current economic impact is profound globally and that the virus will eventually go away and things will bounce back. What happens in between is impossible to say.”Elsewhere, iron ore futures fell as steel inventories surged to a record in China and investors continued to weigh the impact of the coronavirus outbreak. Gold retreated from the highest level since 2013.These are some key events coming up:Earnings keep rolling in from companies including: Peugeot SA on Wednesday; Baidu Inc., Best Buy Co. Inc., Occidental Petroleum Corp. and Dell Technologies Inc. on Thursday; and London Stock Exchange Group Plc on Friday.The Democratic presidential debate in South Carolina is on Tuesday.The Bank of Korea announces its policy decision on Thursday, with rising risks of an interest-rate cut.U.S. jobless claims, GDP and durable goods data are out Thursday.Japan industrial production, jobs, and retail sales figures are due on Friday.These are the main moves in markets:StocksFutures on the S&P 500 Index were little changed as of 6:21 a.m. New York time.The Stoxx Europe 600 Index decreased 0.8%.The MSCI All-Country World Index declined 0.4%.The U.K.’s FTSE 100 Index fell 0.8%.CurrenciesThe Bloomberg Dollar Spot Index was little changed.The euro declined 0.2% to $1.0834.The British pound climbed 0.3% to $1.2964.The Japanese yen appreciated 0.2% to 110.48 per dollar.BondsThe yield on 10-year Treasuries decreased two basis points to 1.36%.The yield on two-year Treasuries dipped less than one basis point to 1.24%.Germany’s 10-year yield decreased three basis points to -0.51%.Britain’s 10-year yield declined two basis points to 0.525%.CommoditiesWest Texas Intermediate crude dipped 0.4% to $51.21 a barrel.Gold weakened 0.5% to $1,650.80 an ounce.–With assistance from Gregor Stuart Hunter and Andreea Papuc.To contact the reporter on this story: Robert Brand in Cape Town at rbrand9@bloomberg.netTo contact the editors responsible for this story: Christopher Anstey at canstey@bloomberg.net, Todd WhiteFor more articles like this, please visit us at bloomberg.comSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.

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