With Ukraine and the Fed in sight, Stocks and Yields decline – Europe Market Wrap
US stock futures fell but Treasuries rose, kicking off a week that will be defined by the level of movement towards a Ukrainian peace settlement and Fed interest rate indications.
S&P 500 contracts dipped 0.1% after the benchmark finished near an all-time high last week. European equities declined 0.2% as Ukrainian President Zelenskiy and his friends arrived in Washington to see what Trump agreed to at his summit with Putin. Cryptocurrencies have retreated.
Treasuries’ gains on Monday were concentrated at the longer end of the curve, diverging from the steepening seen in August. The two-year yield dipped one basis point to 3.74%, while the 10-year yield decreased three basis points to 4.29%. Money markets are pricing in an 80% chance of a quarter-point decrease next month, with at least one more by the end of the year.
In the UK, money markets reduced bets that the BoE would decrease interest rates this year, as signals of rising inflation and a more resilient economy weakened the case for further easing. Swaps indicate a less than 50% possibility of a quarter-point cut by December. A discount was completely priced earlier this month.
According to data, Ether, the second-largest cryptocurrency, lost more than 4% of its value to go below $4,300, while Bitcoin dropped as much as 2.2% to over $115,000. According to CoinMarketCap, the total value of all cryptocurrencies fell to $3.9 trillion.
