Civil unrest in China while fresh hints of still aggressive rate hikes made stocks and commodities stuck in limbo, but underpinned the U.S dollar. Crypto lost at large.Updated time: 06 Dec, 2022, 07:23 (UTC+04:00)
Civil unrest in China that could halt iPhone production in the country sent U.S stocks to deep red territory, amid existing fears of economic uncertainties squeezed by Fed’s hawkish tightening path. All three indexes were pressured by selloff in mostly real estate, energy and tech. Specifically, Nasdaq tumbled 1.58% led by weak big tech. S&P 500 suffered from a 2.6% loss of Cupertino. Dow Jones gave up 1.45%.
Wall Street futures traded in a narrow range of 0.05% apiece. Upcoming key economic data releases: November U.S consumer confidence, second estimate for Q3’s GDP and November nonfarm payrolls as well as Fed speeches will be key focus of this week, though investors are ready to see their sentiment soured.
Oil prices continued to plunge as the lockdown in China slowed down demand. Brent crude futures fell 0.5% to trade at $82.74 while WTI crude futures fell 0.7% to $76.73 a barrel. Ahead of the significant OPEC+ meeting in early December, investors were cautiously hoping for an output cut.
Gold prices fell as Fed’s hawkish notes fanned uncertainties over the tightening path. Spot gold and gold futures dipped about 0.6% to trade at $1,741.3 and $1,740.00 respectively. Copper prices remained unchanged at $3.6018.
The U.S dollar got back little footing after easing 0.1% to 106.50 on hints of further aggressive rate hikes. Investors looking for safe-haven options amid rising tension caused China-related currencies to slide more than 1%. The Aussie gave up 1.61% to $0.6649. The offshore yuan fell to 7.2468 per dollar. The euro, otherwise, rose to a 5-month high of $1.0497 while the Japanese yen was at 139.04.
The FTX crash still negatively impacted the crypto market at large. Bitcoin lost 1.9% to trade around $16,200, as it was reported that crypto lender BlockFi filed for bankruptcy protection earlier in the day. Ethereum changed hands around $1,170, dropping 3% when major investors moved over 73,000 ETH to Binance.