U.S. Futures Slip, Bonds Rise Before Key Jobs Data: Markets Wrap

(Bloomberg) — U.S. equity futures declined and European stocks pared a week of big gains amid lingering worries over the continued spread of the coronavirus. Treasuries climbed before American jobs data.

Contracts on the main American stock gauges pointed to a weak open, while drops in miners and carmakers led the Stoxx Europe 600 Index lower. The dollar rose before a key payrolls report and oil hovered near $51 a barrel in New York. The euro fell as data showed German industrial production had the biggest monthly tumble since the financial crisis. Luxury retailer Burberry Group Plc. slipped scrapping guidance over the virus hitting China sales. Credit Suisse Group AG slumped after ousting its CEO.

Equities slipped across most of Asia as news of further infections on a cruise ship off Japan offered another reminder that cases remain on the rise. Singapore lifted its national disease response to the second-highest level, the same one for the SARS epidemic. Apple Inc.’s Chinese iPhone maker Foxconn told employees not to return to work at its Shenzhen facility when the extended Lunar New Year break ends Feb. 10.

Investor hopes that the epidemic won’t derail a global economic expansion helped drive major stock gauges toward fresh records this week. Yet much of China’s economy remains shut in a bid to contain the virus and a growing list of corporations — including Toyota Motor Corp. and Honda Motor Co. — are temporarily halting operations in the country. China’s oil refiners have cut output, and some firms are reneging on import deals.

Expectations the outbreak will be contained and growth will rebound from the second quarter on the back of stimulus and pent-up activity are “probably somewhat optimistic,” Sue Trinh, macro strategist at Manulife Asset Management, told Bloomberg TV. “The very real risk is that this outbreak spreads, quite literally, into the second quarter and beyond.”

Confirmed cases worldwide now total 31,432, having risen more than 3,000 in day, while the death toll reached 638.

Meanwhile, the presidents of China and the U.S. reaffirmed their commitment to the implementation of a phase-one trade deal in a phone call Friday.

Here are some key events coming up:

The U.S. employment report for January is set for Friday release.

And these are the main moves in markets:

Stocks

Futures on the S&P 500 Index decreased 0.4% as of 6:20 a.m. New York time.Nasdaq 100 Index futures fell 0.5%.The Stoxx Europe 600 Index dipped 0.4%.Germany’s DAX Index declined 0.5%.

Currencies

The Bloomberg Dollar Spot Index increased 0.2%.The British pound climbed 0.1% to $1.2939.The euro fell 0.3% to $1.0952.The Japanese yen strengthened 0.2% to 109.72 per dollar.

Bonds

The yield on 10-year Treasuries declined four basis points to 1.60%.Britain’s 10-year yield decreased one basis point to 0.568%.Germany’s 10-year yield fell two basis points to -0.39%.

Commodities

West Texas Intermediate crude was little changed at $50.93 a barrel.Gold strengthened 0.2% to $1,569.18 an ounce.LME copper futures fell 1% to $5,676.50 per metric ton.

–With assistance from Adam Haigh and Cormac Mullen.

To contact the reporter on this story: Constantine Courcoulas in Athens at [email protected]

To contact the editors responsible for this story: Sam Potter at [email protected], Todd White

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