But for some late dip buying in Wall Street yesterday, it would’ve been a pretty bad showing by stocks to end the day. In Europe, things did get pretty bad with the DAX falling by over 2% at the close. The global bond rout is finally hitting at broader markets and that is going to be the main focus ahead of the US jobs report this week now.
So far today, the mood music is a little calmer. Major currencies are lightly changed with the dollar keeping steadier while S&P 500 futures are up 0.1%. Tech shares are holding on with Nasdaq futures up 0.2%, though the index led declines in falling by 0.8% yesterday.
I would argue that the onus is upon US data now to settle the score for the week. The bond market has already made its voice heard but the jolt yesterday feels a bit like a warning shot at best.
30-year yields in the US are now up to 4.988% and is poised to test the pivotal 5% mark once again. If there is one spot to watch for where the next domino is going to fall, that would be it. And it will be a big one if it does.
As such, expect broader markets to remain cautious as the attention now turns towards labour market data from the US. That’s going to be the make or break for market sentiment this week. Coming up later today, there will be the JOLTS job openings before the ADP employment change, weekly initial jobless claims, and ISM services PMI tomorrow. The ADP has been pushed back a day as it was a US holiday on Monday.
The major one though will of course be the non-farm payrolls on Friday. Take a deep breath
