Stock futures falter, Chinese indices fall

U.S. equity futures ignored another day of losses in China and Hong Kong on Thursday, where indexes were hit by fears over an economic slowdown and debt problems with giant real estate developer China Evergrande Group .

Futures contracts linked to the S&P 500 and the Dow Jones Industrial Average have fluctuated between gains and losses, indicating that both indices could see choppy trading after the opening bell. Contracts for the highly technical Nasdaq-100 edged down by less than 0.1%.

Hong Kong’s Hang Seng fell 1.5% and China’s Shanghai Composite contracted 1.3%. Growth in a range of Chinese economic indicators retreat strongly in August, as a new outbreak of the Covid-19 Delta variant and stricter government regulations in the real estate market affected consumer spending and the housing sector.

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Investors were also concerned that the problems of Evergrande, one of China’s largest residential developers, disrupt the country’s real estate sector, which constitutes a large part of economic expenditure and household wealth.

“Evergrande argued that there are so many vulnerabilities in the Chinese system and it is difficult to know where the Chinese government is intervening,” said Seema Shah, chief strategist at Principal Global Investors. “It’s only that which weighs on confidence.”

Elsewhere, the Stoxx Europe 600 gained 0.6%. Lagardère shares jumped 20% after the media conglomerate Vivendi has reached an agreement to increase its stake in the French group, a move that opens the door to a full takeover.

Actions of Ryanair Holdings rose 4% after the airliner raised its five-year growth forecast to 225 million passengers by March 2026. Shares of other airlines were also up, with EasyJet up 3.3% and Wizz Air Holdings up 2.9%.

Retail sales in the United States, expected at 8:30 a.m. ET, are expected to drop in August. Supply chain issues are hampering auto production and crimping sales, while the resurgence of Covid-19 is shaking consumer confidence and possibly shopping in stores, restaurants and online.

Investors will also get new figures on the number of Americans who first applied for unemployment benefits in the week ending September 11. reached a pandemic low in early September, but economists polled by the Wall Street Journal expect claims to rise in the most recent data.

In bond markets, the yield on the 10-year Treasury bill climbed to 1.309% Thursday from 1.302% Wednesday. Yields increase when prices fall.

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US equity futures fell slightly on Thursday, after a rebound on Wall Street, with European indices largely rising and Asian indices largely declining.

S&P 500 futures fell 0.1% and futures contracts linked to the Dow Jones Industrial Average fell 0.1%. Contracts do not necessarily predict movements after the opening bell.

European stocks rose on Thursday. The Stoxx Europe 600 rose 0.5% in morning trading. The industrials and energy sectors led the gains while the materials and utilities sectors lost ground. Britain’s FTSE 100, dominated by large international companies, climbed 0.3%. Other stocks in Europe also rose mainly, with the French CAC 40 gaining 0.6% and the German DAX gaining 0.3%.

Swiss franc, euro, and the pound fell 0.3%, 0.2%, and 0.1% respectively against the US dollar.

In commodities, benchmark international Brent crude fell 0.1% to $ 75.39 a barrel. Gold also slipped 0.6% to $ 1,784.40 per troy ounce.

The 10-year US Treasury yield strengthened to 1.302% from 1.301%. Yields move in the opposite direction to prices. German 10-year Bund yields fell from minus 0.305% to minus 0.296% and UK 10-year government debt known as the Gilts yield fell from 0.689% to 0.701%.

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In Asia, the indices fell mainly with the Hong Kong Hang Seng down 1.8%, the Japanese Nikkei 225 index 0.6% and the Chinese benchmark Shanghai Composite fell 1.3% after gaining 0.6% earlier.