Global Markets Largely Flat Ahead of Powell's Jackson Hole Speech

By Dow Jones Newswires Staff

Largely rangebound trading across stock markets continued early Friday, with investors jittery ahead of Federal Chair Jerome Powell's Jackson Hole speech at 10:00 ET.

With a month still to run until the September Fed rate decision, August jobs, CPI and PPI reports are due in the interim period, underscoring the uncertainty around monetary policy, Pepperstone's senior rates strategist Michael Brown said in a note. "There is little to no benefit in Powell pre-committing to any action later on today."

Ahead of that, U.S. stock futures were little moved, the dollar rose a touch and U.S. Treasury yields were a tad lower.

• U.S. futures across the S&P 500, Dow Jones Industrial Average and Nasdaq were all narrowly trading near flat early in Europe on Friday after the main indexes all edged lower at the close on Thursday.
• In Europe, the pan-European Stoxx Europe 600 edged down 0.1%, reflecting small gains and losses across all the major national bourses. Still, amid a mixed picture at the close of trading in Asia, Japan's Nikkei 225 index gained 0.1% and Hong Kong's Hang Seng gained 0.6%.

China's benchmark Shanghai Composite climbed 1.4% as mainland stocks were chiefly supported by technology shares gaining on speculation that U.S. chipmaking giant Nvidia might suspend production of its H20 chip in China, potentially allowing Chinese firms to step in. South Korea's Kospi closed 0.9% higher.

• The U.S. dollar was up a touch against a basket of currencies. "Investors will be keenly watching whether Powell places more emphasis on weaker payrolls versus more stable measures of labor market slack and still-solid activity and inflation data," said Deutsche Bank analysts. The DXY dollar index edged up 0.1% to 98.757, having earlier reached a one-and-a-half-week high of 98.834.
• U.S. Treasury yields were marginally lower; the two-year Treasury yield fell 0.7 basis point to 3.784% and the 10-year yield inched down 0.2% basis point to 4.328%, according to Tradeweb.
• Bitcoin struggled to stage a meaningful recovery after hitting a two-and-a-half-week low in the previous session. The cryptocurrency has continued to consolidate from a record-high reached last week as investors take profits and look ahead to key risk events.

Cryptocurrencies and other risky assets could receive a boost if Powell endorses market expectations that the Fed could resume cutting rates in September, but that is by no means a given. Bitcoin edged up 0.5% to $112,986 after falling to a low of $112,008 on Thursday, LSEG data show. It reached an all-time high of $124,480 on Aug. 14.

• Oil prices were up a touch on fading optimism for a near-term cease-fire between Russia and Ukraine. Brent crude was last up 0.3% at $67.85 a barrel, while WTI rose 0.35% to $63.74 a barrel. Oil prices are set to end the week higher as initial enthusiasm for peace talks starts to fall, with a summit between Russia's Vladimir Putin and Ukraine's Volodymyr Zelensky proving difficult while discussions around potential security guarantees are also facing obstacles.

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