Fed Outlook: The latest U.S. data showed a gauge of New York state manufacturing slumped in January, suggesting omicron caused a pullback in activity.
The question investors are wrestling with most is if the Federal Reserve will need to tighten monetary policy to guide inflation lower, or if a softening in economic growth will allow the central bank to be less aggressive in tightening, according to Dennis DeBusschere, founder of 22V Research. The former would be “terrible” for cyclical and technology shares, he said.
In company developments, Microsoft Corp. retreated after unveiling a $69 billion deal for Activision Blizzard Inc. Goldman Sachs Group Inc.’s worse-than-expected fourth-quarter trading revenue weighed on banks.
What to watch this week:
- Morgan Stanley, Bank of America, UnitedHealth Group and Netflix are among companies publishing earnings during the week
- U.S. data includes housing starts Wednesday and jobless claims Thursday
- Interest-rate decisions due from nations including Indonesia, Malaysia, Norway, Turkey and Ukraine, Thursday
- EIA crude oil inventory report, Thursday
Some of the main moves in markets:
Stocks
- S&P 500 futures fell 0.4% as of 12:28 p.m. in Tokyo. The S&P 500 fell 1.8%
- Nasdaq 100 futures fell 0.7%. The Nasdaq 100 fell 2.6%
- Japan’s Topix index fell 1.8%
- Australia’s S&P/ASX 200 index fell 0.8%
- South Korea’s Kospi index shed 0.7%
- Hong Kong’s Hang Seng index added 0.2%
- China’s Shanghai Composite index fell 0.3%
Currencies
- The Bloomberg Dollar Spot Index fell 0.1%
- The euro was at $1.1325
- The Japanese yen was at 114.58 per dollar
- The offshore yuan was at 6.3576 per dollar, up 0.1%
Bonds
- The yield on 10-year Treasuries advanced one basis point to 1.88%
- Australia’s 10-year yield rose six basis points to 2.01%
Commodities
- West Texas Intermediate crude rose 1.3% to $86.54 a barrel
- Gold was at $1,810.56 an ounce, down 0.2%
