(Bloomberg) – US actions have dropped as concerns about whether Washington legislators will avoid a government closure on weekends added to uncertainty about the prospects of the American economy.
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The S&P 500 contracts slipped by 0.6% and those of the Nasdaq 100 dropped by 0.8%, after Wall Street gains on Wednesday stimulated by a softer inflation print than expected. Europe’s Stoxx 600 index has been little changed. Asian actions have withdrawn.
The Democrat Chief of the US Senate, Chuck Schumer, said that his party would block a republican spending bill to avoid a government closure on Saturday and urged the GOP to accept a democratic plan to provide funding until April 11. The imminent force test adds an additional concern of concern for traders who are already faced with a higher unemployment rate, federal job cuts and climbing the climbing war of President Donald Trump.
“The next obstacle is a potential closure of the United States government this Saturday,” said Jim Reid, the world leader in macro research and the thematic strategy of Deutsche Bank AG. “We will see if an agreement can be concluded. Uncertainty may have helped the future S&P and Nasdaq to give up their earnings yesterday. »»
Treasury bills exceeded traders while traders turned to new American economic data later Thursday, with wholesale inflation and the first unemployment claims. The dollar was stable. The Yen has strengthened after the governor of the Bank of Japan, Kazuo Ueda, said that he expects real wages and consumption expenditure to improve.
The risk of closing of the United States government occurs at a time when the financial markets are super sensitive to new disruptions. Two weeks of increased market volatility have already imposed losses for investors and pushed Wall Street strategists to reduce their forecasts for American actions, while the Federal Reserve has adopted a patient approach to interest rate reductions.
“A timely pivot package will be important enough for the market given the bad humor of investors on various pricing threats,” said Homin Lee, Macro-strartège Main at Lombard Odier. “Thus, any legislative setback as the closure that undermines such expectations could become a problem.”
Actions strategists have recently tempered their expectations about the American market. Goldman Sachs Group Inc. became the last to ring the alarm, following those of Citigroup Inc. and HSBC Holdings PLC. Earlier this week, Citi lowered American actions to the neutral overweight while improving China to overweight.
