Article: U.S. Futures Gain, Bond Rally Pauses as Fed Eyed: Markets Wrap

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U.S. Futures Gain, Bond Rally Pauses as Fed Eyed: Markets Wrap

Cecile Gutscher and Joanna Ossinger, 14 June 2021

U.S. equity futures and stocks posted modest gains Monday as investors prepared for a key Federal Reserve meeting later in the week. The rally in bond markets lost steam.

S&P 500 futures signaled the gauge was poised to add to Friday’s fresh record. An advance in European equities was led by shares in energy firms. The Treasury 10-year yield rose to 1.46% after hitting three-month lows on Thursday amid the biggest weekly slide since December. French and German government bond peers also reversed course with yields turning higher.

Investors are on the lookout for signals from the Fed about a timetable for scaling back emergency monetary stimulus. Investors anticipate the central bank will reaffirm the pace of bond purchases this week, even if it delivers projections for interest-rate liftoff in 2023, according to economists surveyed by Bloomberg. The decision is due Wednesday.

With anxiety about an imminent taper fading, bond yields have fallen to the bottom of recent trading ranges, providing a green light for risk-on sentiment that may last until at least August, according to Mizuho International Plc strategists.

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