U.S. Investors Grow More Worried While China Faces A “Lehman-style” Moment

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U.S. stock futures suggested a lower open on Friday as investors are beginning to become more cautious ahead of next week’s Fed meeting.

Some worry that September (historically, a treacherous month) might become more volatile as the month moves on. Meanwhile, concerns about a global slowdown in growth tied to the Delta variant, as well as systemic debt market risk tied to the failure of a massive Chinese conglomerate, are giving investors pause.

The European Stoxx 600 index dropped meanwhile, as a slump in iron ore prices weighed on mining stocks. 

About that “Lehman-Style moment”….

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Chinese development conglomerate Evergrande stated that it could default on its colossal debts. The People’s Bank of China released a $14 billion cash injection into the economy to help ease the pain.Investors are on the lookout for any spillover effects into the global economy. Some have referred to the Evergrande as China’s “Lehman” moment. Of course, it’s unlikely the government will allow a company with so much risk spread through the system to fail like the U.S. did Lehman.

So, there’s that….

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Equities

U.S. futures dropped on concerns over the spread of the Delta variant and Chinese growth.

Level Chg. Chg. %
DOW Futures 34,544.00 -19 -0.06%
S&P 500 Futures 4,451.50 -3.25 -0.08%
Nasdaq Futures 15,466.00 -5.5 -0.04%

U.S. Dollar and Treasuries

The yield on the 10-year Treasury rose one basis point. The dollar weakened against a basket of major currencies.

Price Chg. Chg. %
U.S. Dollar Index (DXY): 92.83 -0.1 -0.11%

 

Yield Change Previous close
U.S. 1 Year Treasury Bill 0.073% -0.001 0.074%
U.S. 2 Year Treasury Note 0.234% 0.013 0.221%
U.S. 5 Year Treasury Note 0.854% 0.013 0.840%
U.S. 10 Year Treasury Note 1.345% 0.009 1.335%
U.S. 20 Year Treasury Bond 1.830% 0.007 1.823%
U.S. 30 Year Treasury Bond 1.888% 0.004 1.884%

Stocks To Watch

Corvus Pharmaceuticals announced that it’s Phase 1/1b clinical trial of Corvus’ small molecule ITK inhibitor CPI-818 for the treatment of relapsed/refractory T cell lymphomas was accepted by the Center for Drug Evaluation in China. 

Shares of Innate Pharma rose as investment bank SVB Leerink maintained its “outperform” rating on the company. 

Shares of SmileDirectClub, a teledentistry company, increased on retail investor interest. Many on social media think that the company is a good candidate for a short squeeze.

Symbol Price Chg. Chg. % Volume
Corvus Pharmaceuticals CRVS $3.54 +1.280 +56.64% 7.03M
Innate Pharma IPHA $7.41 +1.660 +28.87% 1.52M
SmileDirectClub SDC $6.52 +0.520 +8.67% 1.16M

 

Commodities To Watch

Oil prices held above $75 as U.S. supply returns slowly after being disrupted by Hurricane Ida. Gold continues to drop as investors bet on growth. 

Price Chg. %
WTI Crude Oil $72.05 -0.77%
Brent Crude Oil $75.21 -0.61%
Natural Gas $5.35 0.32%
Gold $1,760.70 0.23%
Silver $22.99 0.86%
Copper $4.33 1.16%
Soybeans $1,290.75 -0.41%

Crypto

Crypto markets rose ahead of a potential crackdown by U.S. regulator Securities and Exchange Commission. 

The global crypto market cap is $2.12T, a 2.97% decrease over the last 24 hours. Bitcoin’s dominance is currently 42.12%, an increase of 0.79% in the same period.

Symbol Price Chg. % Market Cap.
Bitcoin BTC $47,555.23 -0.94% $894.91b
Etherium ETH $3,462.44 -4.39% $405.61b
Cardano ADA $2.38 -3.80% $74.02b
Ripple XRP $1.06 -4.37% $46.85b
Dogecoin DOGE $0.2421 -0.79% $31.79b

 

 

 

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Trish Reganhttps://trishintel.com
Trish Regan is an award winning financial journalist, an American television talk show host and author who interprets political events through an economic lens.

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