US futures fall and oil hovers at $100 as recession fears stalk markets
US futuresslipped on Wednesday and oil hovered at $100 a barrel as recessionfears stalked markets.
- Oil tumbled on Tuesday as traders prepared for a likely drop in demand as the world economy slows.
US stock futures slipped on Wednesday and oil hovered around the $100 level as markets weighed up the twin threats of inflation and recession.
WTI crude, the US benchmark oil price, rose 0.81% to $100.32 a barrel after plunging through the $100 mark on Tuesday as investors sold commodities over fears of an impending global recession. Brent crude, the global benchmark, rose 1.46% to $104.24 a barrel.
"Inflation and central bank strategies to get prices in check by curbing demand are increasing the likelihood of a recession," Louise Dickson, senior analyst at consultancy Rystad Energy, said.
"If a recession materializes and inflation continues to push prices for almost everything higher, oil demand is almost certain to fall, bringing prices with it."
Stocks in Europe rebounded on Wednesday after falling sharply the previous day, with the continent-wide Stoxx 600 index 1.17% higher in morning trading.
Investors get the latest look at the US economy on Friday when June's employment report is released. The labor market has remained strong even as inflation has surged to a 41-year high, giving the Federal Reserve the green light to keep raising interest rates.
But analysts polled by Bloomberg expect the US economy to have added 265,000 jobs in June, down from 390,000 in May.
"We forecast that payroll employment growth slowed fairly sharply in June, but remained solid at 250,000," said Andrew Hunter, senior US economist at consultancy Capital Economics. "That should be enough to keep the Fed on track for another 75 basis point rate hike in July."
The yield on the 10-year Treasury note rose by a basis point to 2.816%. Bond yields, which move inversely to prices, have fallen in recent days as investors have sought the safety of government debt.
Elsewhere in markets, bitcoin hovered around the $20,000 mark. The cryptocurrency, which has plunged more than 50% this year, was down around 1% to $20,180 according to Bloomberg prices.
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