(Bloomberg) -- Stocks struggled to gain much traction at the end of a wild week as traders remained cautious after a historic surge in volatility that roiled markets around the world.
The S&P 500 wavered on Friday, and was on track for a fourth straight week of losses — the longest losing stretch in almost a year. While equities rallied on Thursday after data showing the labour market is not collapsing, many investors continued to exercise caution after a meltdown at the start of the week.
“Even if that nerve-racking event is over, we learned how sensitive markets now are to cooler U.S. economic data, how broad-reaching the impact of the yen carry trade can be, and how conditioned investors are to expect rate cuts as the salve for every scrape,” said Liz Young Thomas at SoFi.
At Bank of America Corp., Michael Hartnett says the turbulence in global financial markets has yet to reach proportions that would signal worries about a hard economic landing.
“Technical levels that would flip Wall Street’s narrative from soft to hard landing have not been broken,” Hartnett said. “Investor feedback is ‘frazzled’,” but expectations of U.S. Federal Reserve rate cuts mean that preference for stocks over bonds hasn’t been ended by the market rout, he added.
After pricing aggressive rate cuts this week, traders pared bets to about 100 basis points of Fed easing for the year. A large majority of economists surveyed by Bloomberg see only a quarter-point decrease coming in September — a finding that’s at odds with calls from some large Wall Street banks for a jumbo cut at the next meeting.
The S&P 500 was little changed. Expedia Group Inc. climbed on better-than-expected results, though it warned of “softening” travel demand. Akamai Technologies Inc. raised its full-year forecast for earnings. Treasury 10-year yields fell six basis points to 3.93 per cent.
Some of the main moves in markets:
Stocks
• The S&P 500 was little changed as of 9:38 a.m. New York time
• The Nasdaq 100 was little changed
• The Dow Jones Industrial Average fell 0.2%
• The Stoxx Europe 600 rose 0.2%
• The MSCI World Index rose 0.1%
Currencies
• The Bloomberg Dollar Spot Index fell 0.2%
• The euro was little changed at $1.0921
• The British pound was little changed at $1.2739
• The Japanese yen rose 0.3% to 146.72 per dollar
Cryptocurrencies
• Bitcoin rose 0.6% to $59,911.08
• Ether rose 0.7% to $2,587.94
Bonds
• The yield on 10-year Treasuries declined six basis points to 3.93%
• Germany’s 10-year yield declined five basis points to 2.22%
• Britain’s 10-year yield declined five basis points to 3.93%
Commodities
• West Texas Intermediate crude fell 0.2% to $76.03 a barrel
• Spot gold was little changed
This story was produced with the assistance of Bloomberg Automation.
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