Stocks, Bonds Pause After Choppy Week; Oil Falls: Markets Wrap

(Bloomberg) — Stocks and bonds posted small moves on Monday as investors recalibrated their bets in the wake of last week’s selloff, which saw the steepest loss for the S&P 500 since October.

Most Read from Bloomberg

The Stoxx 600 benchmark was little changed along with futures in the US, while Asian markets declined. Boeing Co. shares are in focus as groundings of the 737 Max 9 aircraft gathered pace globally. Brent crude slid below $78 after Saudi Arabia cut official selling prices for all regions amid persistent weakness in the market.

Markets are looking for direction after global equities and US Treasuries slid the most since October last week on speculation the Federal Reserve was in no rush to reduce interest rates. The US inflation print due Thursday as well as the start of earnings season at the end of the week may offer investors further catalysts.

Reda More: High-Flying Profit Forecasts Head Back Down to Earth: MLIV Pulse

Sentiment remains quite negative in China, Nomura Group analysts including Chetan Seth in Singapore wrote in a client note. “There have been more signs of support for the economy, but equity investors still do not appear convinced,” they said.

In Europe, German factory orders rose much less than anticipated in November, a discouraging sign for Europe’s largest economy, data showed on Monday. Euro-zone retail sales and consumer confidence numbers due later in the day may give a better guide on the region’s economic recovery.

The yield on US Treasuries edged one basis point higher to 4.06%. Some traders are unfazed by the recent pullback, seeing it as a chance to seize on elevated yields before the Federal Reserve starts driving down rates.

The dynamic was on display Friday, when bond prices dipped after the Labor Department reported that job growth unexpectedly accelerated last month. But the selloff was curtailed because buyers swooped in as 10-year Treasury yields neared 4.1%, the highest since mid-December.

In commodities, Brent fell more than 1%, halting last week’s rally after the Saudi price cuts. The reductions underscored a worsening global outlook amid strong global supply, including from the US, and outweighed concern over Red Sea tensions and supply disruptions in Libya.

Key events this week:

Eurozone economic confidence, retail sales, consumer confidence, Monday
Atlanta Fed President Raphael Bostic speaks, Monday
US House returns from recess, Monday
Australia retail sales, Tuesday
Japan Tokyo CPI, household spending, Tuesday
Eurozone unemployment, Tuesday
World Economic Forum’s global risks report released, Wednesday
US wholesale inventories, Wednesday
Deadline for US Securities & Exchange Commission to vote on Bitcoin ETF applications, Wednesday
New York Fed President John Williams speaks, Wednesday
US CPI, initial jobless claims, Thursday
China CPI, PPI, trade, Friday
France CPI, Friday
UK industrial production, Friday
US PPI, Friday
Bank of America, Bank of New York Mellon, BlackRock, Citigroup, JPMorgan Chase and Wells Fargo report fourth-quarter results, Friday
Minneapolis Fed President Neel Kashkari speaks, Friday