Stocks Steady Ahead of Earnings, Inflation and Warsh Testimony – Europe Market Wrap
Stocks steadied as traders avoided making large bets ahead of a packed day featuring the start of Wall Street earnings, key inflation data and testimony from Federal Reserve Chair Kevin Warsh.
S&P 500 futures were little changed. Technology stocks found support as South Korea’s memory chipmakers rebounded, lifting Nasdaq 100 futures 0.5%. Brent crude climbed above $87 a barrel to its highest level in a month as tensions between the US and Iran intensified over the Strait of Hormuz.
Higher oil prices kept expectations of a July Federal Reserve rate hike alive, with swap markets pricing in a roughly 40% chance of an increase at this month’s meeting. Two-year UK gilt yields rose to their highest level since May, while Treasuries traded mixed and the dollar slipped.
The busy schedule began with mixed earnings from JPMorgan Chase, Bank of America and Wells Fargo. Citigroup and Goldman Sachs are also due to report before the US market opens. June inflation data is expected to show some easing after prices accelerated sharply between March and May, while Warsh is set to testify before Congress later in the day.
Europe’s Stoxx 600 fell 0.5%, led lower by travel and leisure stocks, alongside declines in media and consumer-focused companies.
Money markets continue to price in at least one rate hike each from the Bank of England and the European Central Bank this year, with around an 80% chance of a second increase by December.
