US Equity Futures Gain on Cautious China Optimism
Global equities have lost a fifth of their value, the largest decline since 2008 on an annual basis, and an index of global bonds has slumped 16%.
December 28, 2022 at 11:47 AM
2 minute read
U.S. equity-index futures eked out modest gains on Wednesday as further moves by China to reopen its economy modestly lifted investor sentiment in the final week of a dismal year for markets.
S&P 500 futures fluctuated before edging higher after the index fell 0.4% on Tuesday. Shares in Tesla Inc. rose more than 4% in premarket trading, on track to snap a seven-day losing streak amid concerns about ebbing demand. Treasury yields ticked lower as a global bond selloff eased, and a gauge of the dollar slipped.
The Stoxx Europe 600 index advanced, led by basic-resources companies as prices for industrial metals, including copper, climbed. Most European bonds gained, with Germany's 10-year yield falling more than five basis points.
The still-cautious mood is damping hopes for a rally in the last trading week of 2022 after a brutal year for financial markets. Global equities have lost a fifth of their value, the largest decline since 2008 on an annual basis, and an index of global bonds has slumped 16%. The dollar has surged 7% and the U.S. 10-year yield has jumped to above 3.80% from just 1.5% at the end of 2021.
Reports that China would drop quarantine requirements for inbound visitors and begin issuing passports and Hong Kong travel permits to mainland residents may be a boost for the global economy, but they're also raising concern about inflation pressures, which could prompt the Federal Reserve to maintain tight monetary policy.
Oil dipped amid thin liquidity as investors weighed the fallout from a Russian ban on exports to buyers that adhere to a price cap. Iron ore surged to its highest since early August, while copper gained in New York as China's rollback of pandemic curbs boosted prospects for commodities demand in 2023.
Robert Brand and Stephen Kirkland report for Bloomberg News.
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