Stocks Waver, Dollar Slips Ahead of US Jobs Data: Markets Wrap
(Bloomberg) — Stock futures struggled for direction while the dollar fell to its lowest level this month, as traders considered whether Wednesday’s US jobs report would prompt the Federal Reserve to cut interest rates more quickly.
S&P 500 contracts were little changed. The dollar retreated for a fourth consecutive day, weakening against all major peers. Ten-year Treasury yields held at the lowest level in about a month after money markets raised the odds of an April rate cut. Fears of artificial-intelligence disruption weighed on European stocks.
January’s payrolls report is due after US government officials, including National Economic Council Director Kevin Hassett, recently warned that investors should expect lower jobs numbers going forward. Analysts are also anticipating an annual revision to the jobs count, which is expected to reveal a markdown in the year through March 2025.
“We’re still in this sort of, not-really-hiring, not-really-firing mode. But we haven’t seen a clear breakout in either direction,” said Graham Secker, head of equity strategy at Pictet Wealth Management. “Everyone’s very aware of the kind of the K-shape dynamic within the US economy, and the US consumer in particular.”
Gold hovered above $5,000 an ounce. Bitcoin slid below $67,000, with last week’s reprieve proving short-lived and highlighting investors’ lack of confidence in a sustained recovery.
Wealth managers in Europe tracked their US peers lower as fears over the disruptive impact of a new AI tool designed to create tax strategies sparked a sector-wide selloff. St James’s Place Plc slumped 10% in London, while investment platforms such as AJ Bell Plc and IntegraFin Holdings Plc were sliding as well.
Weak guidance by Dassault Systemes SE also played into fears that the French software firm may be vulnerable to AI, sending the stock lower by the most in three decades.
The selloff in software stocks has been overblown, creating buying opportunities for investors, according to Nannette Hechler-Fayd’Herbe, head of investment strategy for EMEA at Lombard Odier.
“There have been a lot of concerns that AI might be disrupting software companies, but we have held the view that actually it is empowering them, it is shortening the time for coding, it is enabling efficiencies of workflows,” she told Bloomberg TV. “For us it’s actually been an opportunity to take exposure.”
Corporate News:
Elliott Investment Management has built a stake in London Stock Exchange Group Plc as the FTSE 100 index owner grapples with disruption from artificial intelligence and a plunge in listings, a person with knowledge of the investment said. Dassault Systemes SE fell the most since 2002, after the French software company published fourth quarter figures below expectations and issued weak guidance for this year. Heineken NV will cut about 7% of its global workforce, as the Dutch brewer contends with a drop in beer demand that is also affecting rivals as prices rise and consumers moderate their alcohol consumption. TotalEnergies SE trimmed its share buybacks to the lower end of its guidance range, aiming to keep debt in check as it adjusts to lower oil prices. Commerzbank AG’s improved outlook for this year failed to sway investors, underscoring the challenges for Chief Executive Officer Bettina Orlopp as she continues to defend the bank against a potential takeover. Some of the main moves in markets:
Stocks
The Stoxx Europe 600 fell 0.3% as of 10:08 a.m. London time S&P 500 futures were little changed Nasdaq 100 futures fell 0.3% Futures on the Dow Jones Industrial Average rose 0.2% The MSCI Asia Pacific Index rose 1% The MSCI Emerging Markets Index rose 0.9% Currencies
The Bloomberg Dollar Spot Index fell 0.3% The euro rose 0.2% to $1.1918 The Japanese yen rose 0.7% to 153.25 per dollar The offshore yuan was little changed at 6.9087 per dollar The British pound rose 0.4% to $1.3693 Cryptocurrencies
Bitcoin fell 2.8% to $66,669.49 Ether fell 3.4% to $1,940.34 Bonds
The yield on 10-year Treasuries declined one basis point to 4.13% Germany’s 10-year yield declined one basis point to 2.80% Britain’s 10-year yield declined two basis points to 4.49% Commodities
Brent crude rose 1.3% to $69.68 a barrel Spot gold rose 0.8% to $5,064.83 an ounce This story was produced with the assistance of Bloomberg Automation.
–With assistance from Rose Henderson.
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