Stocks Fall from Peaks as Traders Become Wary – Europe Market Wrap

Equities slipped lower in cautious trade as investors considered how far a record rise fuelled by Fed interest-rate cuts can last.

S&P 500 futures fell 0.1% after all major US benchmarks reached all-time highs on Thursday. The Stoxx 600 index in Europe also dipped. Microsoft surged in premarket trade, leading the Magnificent Seven, after avoiding a significant antitrust penalty from the EU.

Treasuries retreated from Thursday’s gains, accompanied by weakening in Europe, with the US 10-year yield climbing 2 bps to 4.04%. Following two consecutive losses, the Dollar rallied. Gold rose beyond $3,650 per ounce.

In European markets, the Pound lost a weekly gain after the economy had a weak start to the third quarter, with GDP flat and slowing from the previous month. The FTSE 100 did well, but gilts declined.

French bonds underperformed most regional rivals ahead of a Fitch Ratings update on the country, which is expected after the close. French assets have been rattled since former PM Bayrou announced – and then lost – a confidence vote, failing to secure sufficient backing to reduce the budget deficit.

The difference between French 10-year government bonds and German bunds remained about 78 bps on Friday.