Monday November 28th

U.S. stock index futures fell Monday as social unrest from China’s prolonged Covid restrictions weighed on markets, sending oil prices lower — after Wall Street notched gains during the Thanksgiving holiday-shortened week. Futures tied to the Dow Jones Industrial Average lost 186 points, or 0.5%. S&P 500 and Nasdaq 100 futures each dropped 0.7%. Over the weekend, demonstrations broke out in mainland China as people vented their frustrations with Beijing’s zero-Covid policy. Local governments tightened Covid controls as cases surged, even though earlier this month Beijing adjusted some policies that suggested the world’s second-biggest economy was on its way to reopening. The developments weighed on sentiment in Asia trading, with oil futures hovering around new 2022 lows around demand concerns. Shares of companies with big production facilities in the country led premarket losses.  Shares of Apple lost 1.7% and Tesla declined 2.2% in premarket trading. The moves come after all three major U.S. indexes ended last week higher, even with the shortened trading time due to the Thanksgiving holiday. The Dow rose 1.78%, and the S&P 500 increased 1.53% during the short week. The tech-heavy Nasdaq lagged the other two indexes but was still up 0.72% in the same timeframe. Stocks were lifted during the week by comments from Federal Reserve officials signaling that the central bank would step down its aggressive rate hike path as inflation cools. Minutes from the Fed’s November meeting confirmed the likely shift in policy. “A substantial majority of participants judged that a slowing in the pace of increase would likely soon be appropriate,” the minutes stated. In the last week of November, investors will be watching more earnings reports and a slew of economic releases that will give further information on the state of the consumer and the U.S. economy. Intuit, Salesforce and Five Below are among companies scheduled to report earnings. Personal consumption data and the labor report for November will also be released this week. Shares in the Asia-Pacific are mixed Wednesday after U.S. stocks rose overnight and New Zealand’s central bank delivered a 75 basis point hike, the biggest rate hike ever in the central bank’s history. Singapore’s latest inflation data showed some easing in October on an annualized basis. The NZX 50 index in New Zealand closed down 0.85% at 11,323.8. The S&P/ASX 200 closed up 0.7% at 7,231.8 despite the Reserve Bank of Australia governor Philip Lowe on Tuesday hinting at more rate hikes ahead. South Korea’s Kospi closed up 0.53% to stand at 2,418.01, while the Kosdaq ended 1.84%. Japanese markets are closed for a public holiday. Hong Kong’s Hang Seng index traded 0.81% higher. In Mainland China, the Shanghai Composite rose 0.26% and the Shenzhen Component was down 0.44%. Oil prices fell to near their lowest levels this year on Monday as street protests against strict Covid-19 curbs in China, the world’s biggest crude importer, stoked concern about the outlook for fuel demand. Brent crude dropped $2.86, or 3.4%, to trade at $80.77 a barrel, after diving more than 3% to $80.61 earlier in the session — its lowest since Jan. 4. U.S. West Texas Intermediate (WTI) crude slid $2.54, or 3.3%, to $73.74 a barrel. It fell as far as $73.60 earlier, its lowest since Dec. 22, 2021. Both benchmarks, which hit 10-month lows last week, have posted three consecutive weekly declines. Gold prices rose to more than one-week high on Monday, buoyed by a weaker U.S. dollar and ahead of U.S. Federal Reserve Chair Jerome Powell’s speech later this week that could give clues on the monetary policy outlook. Spot gold was last down 0.16% at $1,753.30 per ounce, after hitting its highest since Nov. 18 earlier in the session. U.S. gold futures last slipped 0.06% to $1,753 per ounce.