- US stock futures fell Friday as investors trod carefully ahead of next week’s Fed policy meeting.
- Oil pulled back from a five-day run of gains on concerns about the impact on production from Hurricanes Ida and Nicholas.
- Asian stocks rose after China injected $14 billion to soothe market nerves over the Evergrande debt crisis.
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US stocks looked set to fall at the open Friday as investors trod carefully ahead of next week’s Federal Reserve policy meeting, while oil pulled back after five days of gains.
Stock futures linked to the Dow Jones were down about 0.2%. S&P 500 and Nasdaq futures were both almost 0.3% lower as of 6:45 a.m. ET, suggesting little change at the start to trading later in the day.
Investors continued to assess the latest US economic data for any impact it could have on the Fed’s timing for tapering its asset purchases. August retail sales released Thursday beat expectations with a 0.7% rise, a positive sign for economic reopening. That brings a little taper risk back into the equation, Deutsche Bank strategists said.
But weekly jobless claims Thursday came in higher than forecast at 332,000, just above pandemic-era lows, as the global chip shortage led to shutdowns in auto production.
The yield on the 10-year Treasury note inched higher to 1.342% on Friday, having spiked to 1.350% after the data before falling back to close at 1.338%. Yields move inversely to prices.
The dollar index, which measures the greenback against a basket of six currencies, was up 0.42% to 92.87.
Led by the US, news from central banks will dominate markets next week, with Japan, the UK, Norway and Switzerland lined up to speak. The Fed’s two-day meeting begins Tuesday.
Oil on Friday reversed some of the gains made in a five-session run higher, on concerns about the threat to crude production from the damaging impact of Hurricanes Ida and Nicholas.
“Sky-high natural gas prices and 40% of US Gulf of Mexico oil industry still being offline post-Ida continues to support prices,” Jeffrey Halley, a senior market analyst at OANDA, said in a note.
In London, airline stocks gained Friday on news the UK is expected to ease pandemic travel restrictions on at least 30 countries on its current “red list.” UK retail sales fell 0.9% in August, official figures released Friday showed, as grocery sales took a hit from growth in dining out.
Asian equity markets closed higher, after the People’s Bank of China injected $14 billion of funds into the financial system. Risks associated with the debt crisis at the Evergrande Group have been a damper on market sentiment.
“With $300 billion in debts, a collapse by Evergrande might be enough to even stay the Fed’s hand, such are the wider shockwaves it would cause,” Halley said, adding that China could continue to provide some form of bailout.