Stock Futures Decline as the Trump Rally Pauses – Europe Market Wrap

US stock futures fell as the market reversed some of its gains following Trump’s election as president, which spurred a risk-on frenzy. US Treasuries rose, recovering much of their post-election losses.

Bonds received some comfort as the Fed dropped interest rates by a quarter-point and indicated that further easing could occur next month. Prior to a 0.1% drop in S&P 500 contracts, the US benchmark was on course for its best week in a year on the promise of tax cuts and deregulation under Trump.

US equities funds drew $20 billion on Wednesday after Trump won the election, the largest daily addition in five months, according to BofA strategists. US stock funds added $32.8 billion in the week ending November 6th.

In China, stocks and the Yuan fell as Beijing officials unveiled a cumulative 10 trillion Yuan ($1.4 trillion) scheme to refinance local government debt, indicating that investors were unimpressed with the latest support measures.

The disappointment resonated through markets, with European stocks swinging from gains to losses, led by drops in China-sensitive sectors like mining, luxury, and cars. Oil prices continued to fall, while iron ore prices dropped.