By Dow Jones Newswires Staff
Following Tuesday’s Wall Street declines, US stock futures experienced a downturn, primarily led by the tech sector. Concurrently, the dollar’s value continued to drop due to concerns revolving around US government debt, as President Trump seeks passage for his tax bill.
On the other hand, Treasury yields saw a rise. Asian stock markets showed mixed results at the end of their trading day, while European stock markets experienced a fall at the start of their trading day.
The 30-year US Treasury yield is nearing 5% again as fiscal anxieties put pressure on the long-end US debt. According to data from LSEG, the 30-year yield has risen nearly 3 basis points to last trade at 4.993%. The two-year Treasury yield saw an increase of 1.5 basis points ending at 3.982%, and the 10-year yield rose 3 basis points to 4.512%.
With investors struggling with the uncertainty surrounding US fiscal policy, and the role of Treasuries and the dollar as portfolio diversifiers and safe havens, the dollar hit a two-week low. The DXY dollar index against a group of major currencies was recently at 99.4230.
In stock markets, Dow Jones Industrial Average futures were down 0.4%, S&P 500 futures fell 0.5%, and Nasdaq futures, which are tech-heavy, were down by 0.6%.
In Asia, Japan’s Nikkei 225 index saw a decline of 0.6% following the latest export data that showed a drop in the country’s shipments to the US for the first time in four months. Japanese government bonds also faced pressure due to weak demand following Tuesday’s poorly received 20-year bond auction. On the other hand, Hong Kong’s Hang Seng saw a gain of 0.4% as market newcomer CATL’s shares continued to rise. China’s benchmark Shanghai Composite also saw a climb of 0.2%.
In Europe, the Stoxx Europe 600 saw a drop of 0.2% in morning trading. France’s CAC 40 and Germany’s DAX both fell by 0.3%. The UK’s FTSE 100 saw a loss of 0.1% while sterling rose to a three-year high against the dollar following data that showed UK inflation accelerated more than expected in April.
Oil prices saw an increase of more than 1% in early trade following a CNN report suggesting that Israel is preparing to strike Iranian nuclear facilities. Brent crude rose 1.1% to $66.07 a barrel, and WTI increased 1.2% to $62.75 a barrel. Gold prices also saw a rise due to the weaker US dollar and renewed safe-haven demand.
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