(Bloomberg) — Stocks fell with bonds Tuesday as concerns about a slowing global economy, hawkish central banks and slumping earnings estimates continued to weigh on sentiment.
The Stoxx Europe 600 fell as a deepening energy crisis cut the outlook for growth.
Technology and miners led losses, while energy and utilities rose, the latter boosted by gains in Electricite de France SA as trading resumed after a weeklong suspension.
Government bonds flipped to losses from gains after Bloomberg News reported the European Central Bank may consider raising interest rates on Thursday by double the quarter-point outlined previously to counter worsening inflation.
US futures fluctuated in the wake of another reversal for the S&P 500 on Monday.
The index erased a 1% gain and ended lower on Apple Inc.’s plans to slow hiring.
Corporate updates such as Apple’s are helping markets to calibrate the risk of recession. Signs that high inflation and monetary tightening are squeezing consumers and employment could feed into worries that an equity revival since mid-June is merely brief respite in a bruising bear market.
“We’re in a period over the next couple of weeks where corporate headlines are really going to drive market activity,” Anthony Saglimbene, global market strategist at Ameriprise Financial Inc., said on Bloomberg Television.
The focus is on how labor and input costs and demand are shaping the outlook, he said.
In Europe, concerns are intensifying about gas supplies from Russia amid a standoff over its invasion of Ukraine.
The European Union is preparing to tell members to cut gas consumption “immediately” to preserve supplies for winter, according to a report.
A halt of Russian gas supplies to the EU could potentially reduce the region’s gross domestic product by as much as 1.5%, according to new estimates from the bloc.
Crude held above $100 a barrel and will likely stay there for the rest of the year, according to Iraq’s energy minister.
Ether was among the leaders of a cryptocurrency rally.
Overall global market volatility is a sign of the struggle “to gauge whether we are seeing, one, peak inflation and two, peak interest rates,” Lale Akoner, strategist at BNY Mellon Investment Management, said on Bloomberg Television.
She expects the US dollar to remain higher for the next six months.
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Key events to watch this week:
- Earnings this week include Netflix, Tesla
- US Treasury Secretary Janet Yellen visits South Korea.
Tuesday
- Reserve Bank of Australia releases July minutes. Tuesday
- UK Chancellor Nadhim Zahawi and Bank of England Governor Andrew Bailey speak at event. Tuesday
- Bloomberg Crypto Summit in New York.
Tuesday
- Bank of Japan, European Central Bank rate decisions. Thursday
- Nord Stream 1 pipeline scheduled to reopen following maintenance. Thursday
Some of the main moves in markets:
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