Global Stock Rally Stalls; Dollar Extends Decline

The global equity rally stalled on Friday, with U.S. futures unwinding some of this week’s surge as the presidential election count continued. The dollar extended its decline to a two-and-a-half-year low.

Contracts on the S&P 500 retreated after the underlying index climbed almost 2% Thursday, heading for its best week since April. Futures on the tech-heavy Nasdaq 100, which is up over 9% this week, also dropped. Treasury yields ticked higher after Federal Reserve officials kept interest rates near zero on Thursday and ahead of closely-watched U.S. payrolls data later on Friday.

Votes are still being tallied in key U.S. states, with Democrat Joe Biden taking the lead in Georgia, one of a handful of states of which he needs to win just one to unseat President Donald Trump. The president, however, questioned the credibility of the election, raising the prospect of a long stalemate as he challenges the results. Meanwhile, Republicans seem set to retain control of the Senate after also making inroads in the House.

The U.S. became the first country to top 100,000 coronavirus infections in a single day. Fed Chair Jerome Powell warned that mounting infection rates are a risk to the recovery. Meanwhile, France warned of a “violent” second wave as it joined European countries including Italy and Poland in reporting new highs in daily infections.

Elsewhere, crude oil declined and gold edged higher. Emerging-market stocks were on track for a fifth day of gains.

These are some key events coming up:

The U.S. non-farm payrolls report is due Friday.
And these are some of the main moves in markets:

Stocks
The Stoxx Europe 600 index dropped 0.4% as of 6:45 a.m. in New York.
S&P 500 futures dipped 0.7%.
The MSCI Asia Pacific Index rose 0.6%.
The MSCI Emerging Market Index climbed 0.4%.

Currencies
The Bloomberg Dollar Spot Index dipped 0.1%.
The yen climbed 0.2% to 103.28 per dollar.
The euro gained 0.4% to $1.1874.
The British pound dipped 0.1% to $1.3129.

Bonds
The yield on 10-year Treasuries rose one basis point to 0.77%.
Germany’s 10-year yield was little changed at -0.64%.
The U.K.’s 10-year yield dropped one basis point to 0.22%.

Commodities
West Texas Intermediate crude fell 3.5% to $37.46 a barrel.
Gold rose 0.3% to $1,955.77 an ounce.

Global Stock Rally Stalls; Dollar Extends Decline: Markets Wrap, Bloomberg, Nov 6