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S&P 500 futures drop with European bank stocks as U.K. gas falls

3 March 2015 18:44 (UTC+04:00)
S&P 500 futures drop with European bank stocks as U.K. gas falls

By Bloomberg

U.S. equity-index futures fell after the Nasdaq Composite Index topped 5,000 for the first time in 15 years. Barclays Plc led European banking stocks lower after taking an additional charge related to a currency-rigging probe and U.K. natural gas dropped, while Australia’s dollar rose.

Standard & Poor’s 500 Index futures slipped 0.3 percent at 8:30 a.m. in New York after the gauge closed at a record. The Stoxx Europe 600 Banks Index slid 0.6 percent. The yield on 10- year Treasuries jumped two basis points to 2.11 percent. The Aussie strengthened after the central bank kept interest rates on hold. Ukraine’s currency and bonds stayed higher after the central bank raised interest rates to the highest level since 2000. Next-month gas in the U.K., Europe’s biggest market, fell for a third day.

Stocks gained earlier and Austria sold its first government bonds with a negative yield as investors awaited details of the European Central Bank’s debt-purchase program on Thursday. While central banks outside the U.S. ease monetary policy to support growth and fight deflation, the Federal Reserve is moving closer to raising interest rates. Data on American jobs this week will probably provide clues on the timetable.

“This week is very much about the ECB and the jobs report,” said Witold Bahrke, an asset-allocation strategist at Nomura International Plc in London. “We had a very strong run in the recent week. It’s only natural that people will step a bit more into the sidelines, especially when you’re heading into these big events at the end of the week when we could see larger moves.”

Nasdaq Rally

The Nasdaq Composite Index has taken two bull markets and more than 4,500 days for the Nasdaq to get close to making up all the ground lost in the dot-com collapse. The index surged 7.1 percent in February, its best month since 2012, and is within 1 percent of a record reached in 2000.

Barclays dropped 2.7 percent. The company set aside an extra 750 million pounds ($1.2 billion) to cover the cost of settling the probe into alleged currency rigging and posted a 32 percent drop in full-year pretax profit at its investment bank.

Ukraine’s hryvnia rose 9.3 percent. The central bank raised its benchmark interest rate to 30 percent from 19.5 percent as policy makers struggle to support a currency that’s lost 60 percent in the past 12 months.

All laws demanded by the International Monetary Fund for the approval of a four-year $17.5 billion loan program have been adopted by lawmakers, Governor Valeriya Gontareva told reporters in Kiev.

Russian Supplies

U.K. natural gas dropped 2.2 percent to 47.51 pence a therm. Russian Energy Minister Alexander Novak and his Ukrainian counterpart Volodymyr Demchyshyn met Monday after a dispute between the two countries over deliveries to rebel-held regions in the east of Ukraine threatened to disrupt gas flows.

Ukraine confirmed at the talks that it will continue paying for the fuel in advance under an interim deal signed in October, Novak said. Russia agreed for now not to charge its neighbor for gas delivered directly by OAO Gazprom to rebel regions in Ukraine under the winter package through March, he said.

Oil traded near $50 a barrel as investors awaited U.S. government data that will signal the pace of supply growth in the world’s biggest consumer. Stockpiles probably expanded by 3.95 million barrels last week, increasing from a record high, according to a Bloomberg News survey before an Energy Information Administration report Wednesday.

Copper fell from the highest close in seven weeks as U.S. data on Monday showed a slowdown in manufacturing. The metal declined as much as 1 percent, snapping three days of gains.

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