Wall Street is set for more pain on Thursday with US stock futures pointing to another round of steep losses a day after the S&P 500 suffered its worst session in eight months.
With about two hours to go before the opening bell, futures for the S&P 500 and the Nasdaq 100 are both down 0.9 per cent while those for the Dow Jones Industrial Average dropped 1 per cent.
Technology stocks, which bore the brunt of yesterday’s severe sell-off, are set for further declines as concerns over slowing global growth, rising interest rates and higher bond yields drive investors to take profits from one of the top-performing sectors of 2018.
Among the pre-market movers:
- Netflix fell 2 per cent
- Apple was down 1.7 per cent
- Facebook dropped 2 per cent
- Google parent Alphabet sank 1.4 per cent
- Amazon retreated 2.2 per cent
- Microsoft shed 1.3 per cent
- Tesla was 1.5 per cent lower
The Vix, popularly referred to as Wall Street’s ‘fear gauge’, was up another 1 point to 24, a day after the gauge registered its highest reading in seven months.
The moves follow steep overnight losses in the Asian markets, with the Shanghai Composite suffering its worst one day fall since February 2016.
European bourses were also awash with red on Thursday. The Europe-wide Stoxx 600 falling to its lowest level since February 2017 while global gauge of stocks — MSCI’s all-country world stocks index— tumbled on Thursday to its lowest level since early February.
The declines come despite the rally in Treasuries. Yield on the benchmark 10-year note — which moves in opposite direction to price — is up 5.1 basis points at 3.1743 per cent. Having suffered a multi-day sell-off in recent days that had pushed yields to their highest level since 2011, Treasuries were in demand on Thursday as investors seek safety from the global equities sell-off.
Gold also received a boost from haven-seeking investors, with prices climbing 0.8 per cent to $1,203 per troy ounce. The dollar, as measured by the DXY index, was down 0.4 per cent at 95.16.
With upbeat economic data in the US reinforcing Fed rate rise expectations and driving up bond yields over the past week, Wednesday’s inflation data, due out at 8:30am EST, could trigger further moves in the markets.
Core consumer prices, which strip out more volatile items like food and energy, are expected to have edged up in September, rising 0.2 per cent month-on-month and 2.3 per cent year-on -year.
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