Stocks Resume Drop After Choppy Week; Boeing Falls: Markets Wrap

(Bloomberg) — US stock futures edged lower on Monday and Treasuries held steady as traders recalibrated their bets in the wake of last week’s selloff. Brent crude fell below $77 a barrel.

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Contracts on the S&P 500 declined 0.2% with Boeing retreating almost 10% after a fuselage section on a 737 Max 9 aircraft ejected during a flight over the weekend. Spirit AeroSystems Holdings Inc., which installed the panel, slumped 21%. Oil slid almost 3% after Saudi Arabia cut official selling prices for all regions amid persistent weakness in the market. European stocks followed declines in Asia.

Markets are looking for direction after mixed US economic data on Friday capped a week that saw global equities sink the most since October on speculation the Federal Reserve was in no rush to reduce interest rates. Further catalysts may come from the US inflation print due Thursday and the earnings season kicking off Friday with US financial names including JPMorgan Chase & Co and Citigroup Inc.

“Multiples are already priced at rich levels,” BNP Paribas analysts including Calvin Tse and Sam Lynton-Brown wrote in a note. “With the probability of a disappointment in full-year earnings elevated, we believe that downside risks outweigh upside ones.”

Read More: High-Flying Profit Forecasts Head Back Down to Earth: MLIV Pulse

According to Bloomberg’s latest Markets Live Pulse survey, the consensus estimate of sell-side analysts is that S&P 500 earnings this year will reach historic levels, but those forecasts are too high. The poll shows an economic slowdown is the biggest risk for the bottom lines this year.

In Europe, German factory orders rose much less than anticipated in November, a discouraging sign for Europe’s largest economy, data showed on Monday.

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Seizing Yields

The yield on US Treasuries declined one basis point to 4.04%. Some traders are unfazed by the recent pullback, seeing it as a chance to seize on elevated yields before the Federal Reserve starts driving down rates.

The dynamic was on display Friday, when bond prices dipped…


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