by John Viljoen and Cecile Gutscher
US equity futures edged lower as traders digested Donald Trump’s latest cabinet appointments and looked ahead to a burst of data on the American economy for clues on the outlook for interest rates.
Contracts on the Nasdaq 100 dropped 0.3% while those on the S&P 500 slipped 0.2%. Treasuries advanced, pushing the 10-year benchmark yield down by four basis points to 4.26% with a slew of pre-Thanksgiving holiday US data expected, including the Federal Reserve’s preferred inflation gauge and an update on economic growth.
The president elect’s tariffs agenda appeared to gather further momentum, as Trump named Jamieson Greer as the US Trade Representative and Kevin Hassett to direct the National Economic Council. Greer was intimately involved in Trump’s first-term trade policy decisions.
“If we get close to a place where we are talking about across-the-board tariffs, I think that would be a wake-up call for risk assets, equities and credit alike,” Wei Li, global chief investment strategist at BlackRock Inc., said in an interview with Bloomberg TV. “We’re risk-on for now, but things could change.”
The euro rose to its highest level of the day after European Central Bank Executive Board member Isabel Schnabel warned against cutting interest rates too far. The currency has been singled out as one of the most vulnerable to Trump’s tariff agenda by strategists at Goldman Sachs Group Inc., JPMorgan Chase & Co., and Citigroup Inc.
A gauge of European stocks declined 0.3%. European companies have among the most to lose from a hardline US stance on tariffs, given manufacturing exports and exposure to China.
In France, a measure of risk on the country’s bonds rose to levels last seen during the euro-area debt crisis as a political standoff over the budget threatens to bring down the government. The market nerves reflect investor concerns over Prime Minister Michel Barnier’s ability to pass a budget for next year.
Middle East tensions abated somewhat as President Joe Biden said Israel reached a cease-fire deal with the Lebanese militant group Hezbollah after weeks of talks mediated by the US.
In commodities, oil steadied as signs OPEC+ will once again delay restoring some output countered easing geopolitical risk after the cease-fire agreement.
Key events this week:
Some of the main moves in markets:
Stocks
Currencies
Cryptocurrencies
Bonds
Commodities
This story was produced with the assistance of Bloomberg Automation.
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