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Chinese manufacturing in September has been damped by an energy crunch.
AFP via Getty Images
The stock market was rising Thursday as investors put concerns around central bank stimulus in the rearview, while equities in Asia remained under pressure from an energy crisis in China weighing on industrial production.
Futures for the
Dow Jones Industrial Average
indicated an open 250 points higher, after rising 90 points Wednesday to close at 34,390.
Futures for the
S&P 500
and
Nasdaq
indicated a similar open, but it will take a big surge Thursday for the S&P 500 to avoid its worst monthly performance this year, even as it remains in positive territory for the third quarter of 2021.
Stocks have come under pressure this week in large part from fears around the end of central bank stimulus, as investors look to the U.S. Federal Reserve soon slowing, or tapering, its Covid-19 pandemic-era program of monthly asset purchases. An energy crunch putting pressure on industrial production in China, as well as concerns around inflation, further weighed on markets.
Investors looked set to brush aside those pressures Thursday.
“Markets are hobbling into the end of Q3 today even if they’ve seen some signs of stabilizing over the last 24 hours following their latest selloff, with equities bouncing back a bit and sovereign bond yields taking a breather from their recent relentless climb,” said Jim Reid, a strategist at Deutsche Bank.
A “taper tantrum” hit markets Tuesday, sending bond yields higher and hurting technology stocks in particular. Elevated yields make future profits less valuable, hitting high-growth companies like tech groups, which are forecast to see profits many years into the future. The yield on the benchmark 10-year U.S. Treasury note was nearing 1.54% early Thursday, but ceased the type of surging seen earlier this week.
“Investors continued to balance the risks of surging energy prices, supply-chain disruptions, and concerns about more persistent inflation,” said Michael Hewson, an analyst at broker CMC Markets.
“We should get a better idea of sentiment next week, when all this week’s noise is behind us, however it is inescapable that the sudden turnaround in 10-year yields from 1.3% a week ago, to above 1.5% this week, does suggest that bond markets have undergone a significant change in sentiment.”
Overseas, Hong Kong’s
Hang Seng Index
fell 0.5%. An energy crunch in China has hit…
Read More: Stock Market Today: Dow Set to Rise as Energy Crisis Hits Chinese