Stocks to Start Week Steady Amid Growth Concerns: Markets Wrap

Concerns about slowing growth in the world's largest economies will keep stocks cautious this week.

In Australia and Hong Kong, futures fell, but in Japan they were flat. The S&P 500 dropped for a seventh week in a row and narrowly avoided sinking into a bear market. The U.S. stock futures opened higher.

Early Monday in Asia, the dollar traded within tight ranges. The Australian dollar appreciated after the election result, with Labor ousting the Liberal-National coalition. The 10-year yield fell below 2.8% on Friday as traders debated the Federal Reserve's tightening path.

If Chinese banks cut a key interest rate for long-term loans by a record amount as a property slump and Covid lock-ups weigh on the economy, traders will watch if stocks can maintain gains.

There are concerns about an economic downturn and more monetary tightening. China's adherence to its Covid zero policy is disrupting supply chains and fanning commodity price shortages.

The Russia-Ukraine conflict and China's stringent Covid lockdowns will cause great volatility in the market.

The minutes of the most recent Fed rate-setting meeting will give markets insight this week into the US central bank's tightening path. If the central bank front-loads an aggressive series of rate hikes to push rates to 3.5% at the end of the year, it will push down inflation and lead to easing in the years to come.

There are some important events to watch this week.

• Atlanta Fed President Raphael Bostic, Kansas City Fed President Esther George speak at events Monday
• ECB Governing Council members Robert Holzmann and Joachim Nagel, BOE Governor Andrew Bailey discuss inflation at event Monday
• Eurozone S&P Global PMIs Tuesday
• US new home sales, S&P Global PMIs Tuesday
• Reserve Bank of New Zealand rate decision Wednesday
• FOMC minutes Wednesday
• ECB publishes its Financial Stability Review Wednesday
• Bank of Korea rate decision Thursday
• US GDP, initial jobless claims Thursday
• US core PCE price index; personal income and spending; wholesale inventories; University of Michigan consumer sentiment Friday

There are some main moves in markets.

Stocks

• The S&P 500 was little changed Friday. S&P 500 futures rose 0.5%
• The Nasdaq 100 fell 0.3%. Nasdaq 100 futures advanced o.5%
• Nikkei 225 futures were little changed
• Australia’s S&P/ASX 200 Index futures fell 0.2%
• Hang Seng Index futures fell 1.5% earlier

Currencies

• The Bloomberg Dollar Spot Index rose 0.2%
• The euro was at $1.0563
• The Japanese yen was little changed at 127.92 per dollar
• The offshore yuan was at 6.6956 per dollar

Bonds

• The yield on 10-year Treasuries declined six basis points to 2.78%

Commodities

• West Texas Intermediate crude fell 0.1% to $110.16 a barrel
• Gold was at $1,844.55 an ounce