Economy Stock Stock market

Stocks Decline on Earnings, Fading Stimulus Hopes: Markets Wrap

(Bloomberg) – Stocks slid Europe while U.S. futures dropped more modestly on Thursday after corporate earnings failed to re-ignite rallies and prospects wilted for new stimulus from Washington before the November election. The dollar rose with Treasuries.

The Stoxx Europe 600 Index quickly headed toward its biggest drop in three weeks. Roche Holding slipped after quarterly sales fell short of estimates. Oil producer Total SE dropped after reporting its European refining margin ebbed. The drop in U.S. index futures signaled U.S. equities may fall for a third session. That’s unless earnings from Morgan Stanley and Charles Schwab later on Thursday manage to spark some optimism.

China’s stock market outperformed peers in Asia. The country’s central bank added medium-term funding to the financial system to help guide the economy further through the pandemic.

Investors searching for fresh impetus for the markets will watch for U.S. jobless data in several hours and retail sales reports on Friday. They’re not finding hope in Washington, where Treasury Secretary Steven Mnuchin said getting a stimulus agreement before the election would be difficult, and Democratic leaders are showing no appetite for piecemeal measures now.

“The latest twist I heard is nothing is going to get done until the election,” said Paul Nolte, a portfolio manager at Kingsview Investment Management. “That’s why I think you’re getting the market selling off a little bit.”

Earlier in Asia, shares in Hong Kong, Japan and South Korea saw the biggest losses, while Australian stocks climbed. Stocks in Thailand dipped after a state of emergency was declared in Bangkok to crack down on anti-government protesters.

U.S. shares retreated Wednesday with Wells Fargo & Co. and Bank of America Corp. both falling after disappointing investors. Goldman Sachs Group Inc. outperformed after earnings beat expectations.

In virus news, Germany’s daily cases rose at the fastest pace since the pandemic began, joining record infections from Italy to the Czech Republic. Europe intensified efforts to stem the outbreaks, with France announcing further restrictions and London set for a clampdown.

Here are some key events coming up:

Morgan Stanley’s earnings are scheduled for Thursday.European Central Bank President Christine Lagarde leads off the virtual annual meetings of the International Monetary Fund and the World Bank Group. Through Oct. 18.

These are some of the main moves in markets:

Stocks

The Stoxx Europe 600 Index sank 1.8% as of 8:38 a.m. London time.Futures on the S&P 500 Index fell 0.6%.Nasdaq 100 Index futures declined 1%.The MSCI Asia Pacific Index sank 1%.

Currencies

The Bloomberg Dollar Spot Index increased 0.2%.The British pound decreased 0.1% to $1.2994.The Japanese yen was little changed at 105.19 per dollar.The Australian dollar declined 0.9% to $0.71.

Bonds

The yield on 10-year Treasuries dipped two basis points to 0.70%.Germany’s 10-year yield fell three basis points to -0.61%.Britain’s 10-year yield decreased two basis points to 0.196%.Italy’s 10-year yield rose two basis points to 0.674%.

Commodities

West Texas Intermediate crude dipped 0.5% to $40.82 a barrel.Gold weakened 0.1% to $1,899.95 an ounce.Natural gas gained 2.2% to $2.70 per mmbtu.Iron ore decreased 0.5% to $114.56 per metric ton.

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