Stocks could extend a rally on Monday, though questions remain as to how long the bear market can be kept at bay amid high inflation, monetary tightness and the risk of a recession.
Futures for Japan, Australia and Hong Kong rose after global stocks jumped nearly 5% last week, their best such performance in a month, as investors broke out of beaten-down stocks in defensive sectors such as health and technology.
Contracts for the S&P 500 and Nasdaq 100 slipped on Friday in the wake of more than 3% rise in both indices. A gauge of the dollar moved lower.
treasury yield Have retreated from June highs as growth concerns take center stage, pushing the US 10-year yield to 3.13%. Whether this marks the end of the worst Treasury bear market of the modern era is another lively debate.
Oil fell again to around $106 a barrel on concerns about demand. Traders are also monitoring a summit of the Group of Seven leaders, which plans to extend indefinite support to Ukraine’s defense against Russian aggression. The G-7 is also weighing a price cap on Russian oil.
Investors are parsing the incoming data to find out highest inflation One generation is close to cresting. Over time, this can give policy makers a leeway to cushion sharp interest rate hikes. A more troubling scenario is that of enduring price pressures and tighter policy even as the global economy falters.
“It looks like things are not as bad as we thought they were going to be,” Carol Pepper, founder of Paper International, said on Bloomberg radio. “There’s an expectation that maybe we’re oversold, maybe not that there’s going to be a recession,” he said.
Mary Daly, chair of the Federal Reserve Bank of San Francisco, said Friday that she favors another 75 basis-point increase in July. Meanwhile, James Bullard, President of the Fed Bank of St. Louis, said fears of a US recession were over.
Elsewhere, Russia defaulted on its foreign currency sovereign debt for the first time in a century, the culmination of tough Western sanctions that shut down payment routes. The US, UK, Japan and Canada are also planning to announce a ban on new gold imports from Russia during the G-7 summit. Prices of the precious metal rose. Among cryptocurrencies, bitcoin and a range of other coins weakened slightly, but the largest virtual coin held above $21,000.
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