U.S. Stock Futures Slide on Trade Concern; Oil Up: Markets Wrap

(Bloomberg) — U.S. equity futures turned lower on further signs of strained relations between America and China and ahead of more economic data. European stocks rose as investors weighed the latest figures on the spread of the coronavirus.

Contracts on the three main U.S. equity gauges reversed earlier gains shortly after Reuters reported the country is moving to block global chipmakers from supplying Chinese telecom giant Huawei Technologies Co. The Stoxx Europe 600 also trimmed its advance on the news, though it remained higher as Italy edged toward allowing free movement and Germany reported a drop in new infections. Crude headed for a third weekly gain amid signs the oil market is slowly rebalancing.

Flaring U.S.-China tensions have hung over markets all week, and President Donald Trump said in remarks broadcast Thursday that he doesn’t want to talk to his Chinese counterpart Xi Jinping right now. Stress between the nations is an extra headache for investors as they grapple with the ongoing fallout of the coronavirus.

While the likes of Germany are showing some success at containing the virus, other countries that had quelled the pandemic such as South Korea and China are seeing a rise in cases, underscoring the tough choices policy makers face as they try to resuscitate their economies.

Hopes over the rate of infection and a potential compromise on a European recovery fund had helped investors look past data that showed the German economy shrank 2.2% in the first quarter, the most in more than a decade.

Elsewhere, Asian shares were mixed after data showed a rebound in Chinese industrial production but a deeper than expected drop in retail sales. Gold rose. European bonds drifted.

These are some of the main moves in markets:

Stocks

Futures on the S&P 500 Index dipped 0.8% as of 7:13 a.m. New York time.The Stoxx Europe 600 Index advanced 0.5%.The MSCI Asia Pacific Index advanced 0.2%.

Currencies

The Bloomberg Dollar Spot Index climbed 0.1% to 1,255.63.The euro advanced 0.1% to $1.0815.The British pound dipped 0.2% to $1.2201.The Japanese yen strengthened 0.3% to 106.93 per dollar.

Bonds

The yield on 10-year Treasuries dipped two basis points to 0.60%.Germany’s 10-year yield fell one basis point to -0.56%.Britain’s 10-year yield decreased two basis points to 0.187%.

Commodities

West Texas Intermediate crude increased 1.3% to $27.91 a barrel.Gold strengthened 0.3% to $1,735.16 an ounce.

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