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The Friday Market Minute

  • Global stocks slide in the wake of Wall Street’s Thursday sell-off, with investors also spooked by fresh lockdown orders in France.
  • French President Emmanuel Macron orders business and travel restrictions for the greater Paris region following a spike in infections earlier this week.
  • Benchmark 10-year note yields east to 1.689% overnight, giving tech stocks a boost following last night’s 3% slump.
  • CDC data shows 41 million Americans have now been fully vaccinated against the coronavirus, with more than 115.7 million doses administered as of Thursday.
  • Oil rebounds from its biggest single-day decline since September, with WTI up 85 cents, amid questions on both European energy demand and swelling domestic crude supplies.
  • U.S. equity futures suggest a firmer open on Wall Street with Apple and Tesla leading the morning rebound. 

Wall Street looked to rebound from its biggest sell-off in three weeks Friday, with futures indicating modest gains amid market concerns for rising inflation, higher bond yields and a sputtering European recovery. 

Tech stocks were hammered yesterday as benchmark 10-year bonds yields surged to a 14-month high of 1.75% in the wake of Federal Reserve Chairman Jerome Powell’s dovish pledges on interest rates and liquidity support, with the Nasdaq tumbling more than 400 points to close in negative territory for the year. 

Investors were also spooked by the announcement of a new lockdown measures in France, where President Emmanuel Macron ordered business and travel restrictions for the greater Paris region, a move that affects nearly 20 million people, following a days-long spike in new coronavirus infections.

In the U.S., however, the seven-day average of new infections continues to decline, while the CDC has administered 115.7 million doses of vaccine as of March 18, with nearly 41 million Americans now fully inoculated. 

That certainly plays into the growth and re-opening prospects implicit in the Fed’s GDP and inflation forecasts, but also indicates the start of a profit cycle for American companies that could underpin stock valuations on Wall Street . 

And with benchmark 10-year yields easing to 1.689% in overnight trading, stocks are looking to claw back some of yesterday’s losses at the opening bell, with futures contracts tied to the Dow Jones Industrial Average indicating an 80 point bump higher and those linked to the S&P 500 priced for a 13 point gain.

Nasdaq Composite futures, meanwhile, are looking for a 98 point head start on the back of premarket gains for Apple  (AAPL) – Get Report, Tesla  (TSLA) – Get Report and the chipmaker Advanced Micro Devises  (AMD) – Get Report.

Other pre-market movers were linked to quarterly earnings posted last night, with FedEx  (FDX) – Get Report rising 4.35% after a stronger-than-expected third quarter bottom line of $3.47 per share, and Nike  (NKE) – Get Report, which fell 3.4% after disappointing third quarter sales that were hit by pandemic-related delays to its supply chain.

Oil markets were also in focus Friday following yesterday’s extended declines, the biggest six months, that saw U.S. crude prices plunge more than 7% to close at the $60 per barrel mark.

Europe’s energy demand uncertainty, a stronger U.S. dollar and swelling domestic and global supplies have all been citied by analysts as triggers for the move, along with the pending expiry of ‘front-month’ futures contracts on March 22. 

Still, with the greenback down 0.1% against a basket of its global peers Friday, traders are scooping-up cheap crude contracts, with WTI rising 85 cents a barrel to $60.85 and Brent up $1.06 to $64.33 per barrel.

In overnight equity trading, Asia closed sharply lower following the late-afternoon selloff on Wall Street, with the Nikkei 225 ending the session 1.4% in the red at 29,792.05 points and the MSCI ex-Japan benchmark falling 1.1%.

In Europe, the move to impose a mini-lockdown in France has stocks in the region in the red, with the CAC-40 in Paris down 0.62% and the Stoxx 600 off 0.32%.