Before PCE, Tech Stocks Fell in Risk-Off Trade – Europe Market Wrap

Technology stocks drove markets lower on Friday as traders reduced risk ahead of US inflation data, which might test expectations for the pace of Fed interest rate decreases.

Futures for the Nasdaq 100 declined 0.6%. Nvidia fell 1.3% in premarket trade, the most among the Magnificent Seven titans. Dell Technologies fell more than 6% after citing slower sales of AI servers. S&P 500 futures fell 0.3% from Thursday’s all-time high.

Longer-dated US Treasuries declined, with the 30-year note yield climbing three basis points to 4.90%. The Dollar rose 0.2%, putting it on track to end a streak of three weekly losses. In Europe, the Stoxx 600 fell 0.4%, as bond markets sank across the board due to persistent political upheaval in France.

Friday’s stock market downturn casts a pall over what is traditionally the most difficult month for US markets. According to Bank of America analysts, the S&P 500 has declined 56% of the time in September, with an average drop of 1.17%.

Currency traders predict greater Dollar depreciation next month, especially if Trump escalates his attacks on the Fed into unknown territory. The Dollar is set to continue its monthly losing skid after earning its first gain of the year in July.