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Stocks, Futures Fall on Growth Risk, China Selloff: Markets Wrap 


(Bloomberg) — Asian stocks fell Friday as the fast-spreading delta virus strain stoked concerns about economic growth and China’s regulatory curbs hurt sentiment. The dollar was firm and commodities trimmed a weekly drop.

MSCI Inc.’s Asia-Pacific gauge was at the lowest since around December. Shares slid in China and Hong Kong was poised for a bear market as Beijing cracks down on private industry. U.S. futures dipped after modest S&P 500 and Nasdaq 100 gains in choppy overnight trading. European contracts fluctuated.

Tougher rules for handling user data are Beijing’s latest step against big tech. Alibaba Group Holding Ltd. hit another record low. State media also scrutinized liquor makers, online pharmacies and cosmetics firms.

Treasuries climbed and the dollar was around a nine-month high. Commodities stabilized but their recent slump is flashing a warning about the impact of Covid-19’s resurgence on the global recovery. Commodity-linked currencies including the New Zealand, Canadian and Australian dollars slipped.

The delta strain is stoking doubts about achieving herd immunity to underpin economic reopening, just as Chinese activity slows and the Federal Reserve eyes a gradual reduction of emergency stimulus. That mix puts global stocks and commodities on course for one of their worst weeks this year. Analysts cautioned that options expirations due Friday may also be fueling volatility.

“The delta variant of Covid is significantly more serious than anyone is really even pricing into the market,” Hilary Kramer, chief investment officer at Kramer Capital Research, said on Bloomberg Television. “We know that tapering is coming. We know that the market is getting tired.”

The toll from the virus variant is growing: patients are dying in U.S. hospitals at levels not seen since February. New Zealand and Sydney in Australia extended lockdowns. Apple Inc. and Charles Schwab Corp. are among the firms pushing back return-to-office plans.

Pandemic-related disruptions to supplies of semiconductors and other components are also affecting the operations of companies such as Toyota Motor Corp. and BMW AG.

For more market analysis read our MLIV blog.

Some of the main moves in markets:

Stocks

S&P 500 futures fell 0.3% as of 6:50 a.m. in London. The S&P 500 rose 0.1%Nasdaq 100 contracts lost 0.2%. The Nasdaq 100 climbed 0.5%Japan’s Topix index shed 0.9%Australia’s S&P/ASX 200 index fell 0.1%South Korea’s Kospi index was down 1.4%Hong Kong’s Hang Seng index slid 2.2%China’s Shanghai Composite index fell 2%

Currencies

The Bloomberg Dollar Spot Index was little changedThe euro was at $1.1688, up 0.1%The Japanese yen was at 109.67 per dollarThe offshore yuan was at 6.5067 per dollar

Bonds

The yield on 10-year Treasuries was at 1.23%, down one basis point

Commodities

West Texas Intermediate crude was at $64.09 a barrel, up 0.6%Gold was at $1,786.81 an ounce, up 0.4%

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