(Bloomberg) — Stocks posted small moves as traders focused on key inflation data in Europe and the Federal Reserve’s preferred price-growth measure for hints on the scope and timing of policy easing.
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The Stoxx 600 was little changed, set for a 2.4% gain in the month. Contracts for US equities edged lower after the S&P 500 fell on Thursday, driven by tech-sector losses. The dollar and US Treasuries were steady.
The core PCE deflator, which the Fed favors for measuring inflation, likely moderated in April to the slowest monthly pace yet this year. In Europe, price data will help traders judge how much room policy makers have for interest-rate reductions with the European Central Bank’s meeting due next week.
Stock gains this month were fueled by the rally in tech as well as Fed Chair Jerome Powell’s dovish posture on rates at the start of May. That optimism has faded over the course of the month, and Friday’s data could revive hopes for easing if there are signs inflation is returning to target.
Global Bond Markets Wobble Once Again as Rate-Cut Hopes Deflate
In emerging markets, South Africa’s rand led declines among developing-nation peers after falling more than 3% over three days. Investors are awaiting the final results of the nation’s elections amid concern over the different permutations a coalition may take, and whether a market-friendly government will emerge.
Hope and Angst Grip South African Markets as Coalition Era Dawns
Trump Convicted
Elsewhere, a jury found Donald Trump guilty on all 34 counts of falsifying business records at his hush-money trial, making him the first former US president to be convicted of crimes. With Trump to due to face sentencing on July 11, the conviction creates a daunting legal and political path as he faces President Joe Biden in November as the presumptive Republican nominee.
“Expectations for a guilty verdict were somewhat priced into markets,” Paresh Upadhyaya, director of fixed income and currency strategy at Amundi Asset Management in Boston. “The bigger impact to markets could be if this guilty verdict begins to turn the momentum away from Trump to Biden.”
Trump Media & Technology Group traded down 12% in extended trading.
Wall Street Billionaires Rush to Back Trump, Verdict Be Damned
Key events this week:
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Eurozone CPI, Friday
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US consumer income, spending, PCE deflator, Friday
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Fed’s Raphael Bostic speaks, Friday
Some of the main moves in markets:
Stocks
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The Stoxx Europe 600 was little changed as of 8:55 a.m. London time
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S&P 500 futures fell 0.2%
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Nasdaq 100 futures fell 0.5%
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Futures on the Dow Jones Industrial Average were little changed
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The MSCI Asia Pacific Index was little changed
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The MSCI Emerging Markets Index fell 0.7%
Currencies
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The Bloomberg Dollar Spot Index rose 0.1%
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The euro was little changed at $1.0823
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The Japanese yen fell 0.2% to 157.14 per dollar
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The offshore yuan fell 0.1% to 7.2618 per dollar
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The British pound fell 0.2% to $1.2705
Cryptocurrencies
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Bitcoin fell 0.6% to $68,092.45
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Ether fell 0.4% to $3,724.29
Bonds
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The yield on 10-year Treasuries advanced one basis point to 4.56%
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Germany’s 10-year yield advanced two basis points to 2.67%
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Britain’s 10-year yield advanced two basis points to 4.37%
Commodities
This story was produced with the assistance of Bloomberg Automation.
–With assistance from Matthew Burgess, Carter Johnson and Chiranjivi Chakraborty.
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