(Bloomberg) — Stocks were mixed at the end of a volatile week, while U.S. futures fluctuated as investors weighed prospects of tightening policy and strong earnings from Apple Inc.
Contracts on the S&P 500 were little changed after erasing earlier gains, while those on the Nasdaq 100 trimmed an advance of as much as 1.4%. Apple rallied in post-market trading. European shares fell, led by tech and auto shares, as investors shrugged off stronger-than-expected growth in Spain and France. Retailers were a bright spot after Hennes & Mauritz AB’s profit beat estimates.
An Asia-Pacific gauge rose for the first day in six as gains in Japan offset declines in China. A dollar gauge ticked up, while Treasuries slipped.
Global markets have been whiplashed this week by volatility as the Federal Reserve signaled aggressive tightening, while geopolitical tensions and an uneven earnings season also sapped sentiment. Value stocks are outperforming as investors brace for rising rates, rotating out of frothier names.
Money markets are now pricing in nearly five Fed hikes this year following Chair Jerome Powell’s hawkish tone Wednesday. That’s up from three expected as recently as December.
“Tighter liquidity and weaker growth mean higher volatility,” Barclays Plc strategists led by Emmanuel Cau wrote in a note. The “current growth scare looks like a classic mid-cycle phase to us, while a lot of hawkishness is priced in.”
The U.S. stock market is priced “quite aggressively” versus other developed nations as well as emerging markets, and valuations in the latter can be a tailwind rather than a headwind as in the U.S., Feifei Li, partner and CIO of equity strategies at Research Affiliates, said on Bloomberg Television.
Perpetual Loser Europe Looks a Safer Bet in Global Equity Rout
Elsewhere, oil headed for a sixth weekly advance and gold nursed losses.
What to watch this week:
- Euro zone economic confidence, consumer confidence Friday.
- U.S. consumer income, University of Michigan consumer sentiment Friday.
For more market analysis, read our MLIV blog.
Some of the main moves in markets:
Stocks
- The Stoxx Europe 600 fell 0.8% as of 8:39 a.m. London time
- Futures on the S&P 500 rose 0.1%
- Futures on the Nasdaq 100 rose 0.4%
- Futures on the Dow Jones Industrial Average were little changed
- The MSCI Asia Pacific Index rose 0.5%
- The MSCI Emerging Markets Index fell 0.1%
Currencies
- The Bloomberg Dollar Spot Index rose 0.2%
- The euro fell 0.2% to $1.1125
- The Japanese yen fell 0.2% to 115.58 per dollar
- The offshore yuan was little changed at 6.3710 per dollar
- The British pound was little changed at $1.3376
Bonds
- The yield on 10-year Treasuries advanced two basis points to 1.82%
- Germany’s 10-year yield was little changed at -0.05%
- Britain’s 10-year yield was little changed at 1.24%
Commodities
- Brent crude rose 0.7% to $89.94 a barrel
- Spot gold fell 0.3% to $1,792.71 an ounce
More stories like this are available on bloomberg.com
©2022 Bloomberg L.P.
