U.S. Futures Fall With Inflation, Tax Plan in View

U.S. equity-index futures dropped with Treasuries as investors weighed inflation risks and the impact of a minimum corporate tax on technology firms. The dollar ticked up. Futures on the Nasdaq 100 and S&P 500 declined, while European stocks fluctuated between gains and losses. The 10-year rate added two basis points after Treasury Secretary Janet Yellen said a slightly higher interest-rate environment would be a plus. Oil in New York slipped after rising to $70 per barrel as short-term demand worries continued. Tesla Inc. dropped in premarket trading after canceling plans for a longer-range sedan.

While resurgent inflation has sparked a debate about when the Federal Reserve will start tapering monetary accommodation, recent data including the May nonfarm payrolls report seemed to vindicate the central bank’s dovish stance. Investors are trying to strike a balance between preparing for higher rates and riding a risk-on rally supported by Fed stimulus and a $4 trillion spending plan by President Joe Biden. Traders await the U.S. consumer-price index report Thursday for more clues.

Yellen said Biden should push forward with his spending plans even if they spark inflation that persists into next year. Meanwhile, the Group of Seven rich nations secured a landmark deal that could help countries collect more taxes from big firms and enable governments to impose levies on U.S. giants such as Amazon.com Inc. and Facebook Inc.

Stocks

The Stoxx Europe 600 was little changed as of 9:43 a.m. London timeFutures on the S&P 500 fell 0.2%Futures on the Nasdaq 100 fell 0.3%Futures on the Dow Jones Industrial Average were little changedThe MSCI Asia Pacific Index was little changedThe MSCI Emerging Markets Index was little changed

Currencies

The Bloomberg Dollar Spot Index rose 0%The euro was little changed at $1.2159The Japanese yen was little changed at 109.44 per dollarThe offshore yuan was little changed at 6.3927 per dollarThe British pound fell 0.2% to $1.4126

Bonds

The yield on 10-year Treasuries advanced two basis points to 1.58%Germany’s 10-year yield advanced one basis point to -0.20%Britain’s 10-year yield advanced one basis point to 0.80%

Commodities

Brent crude fell 0.7% to $71 a barrelSpot gold fell 0.4% to $1,884 an ounce

U.S. Futures Fall With Inflation, Tax Plan in View: Markets Wrap, Bloomberg, Jun 7