➤ Gold, yen climb as Argentine stock rout unnerves investors.
➤ Ten-year Treasurys rise along with dollar before inflation data.
➤ Italian Senate to decide date of PM confidence vote.
➤ Euro dips as German economic sentiment falls to lowest since 2010.
U.S. stock futures retreated with global equities as investors sought safe-haven assets after the surprise outcome in Argentine elections revived fears of another default in the Latin American country, while a report showed continued deterioration of economic sentiment in Germany. The dollar index advanced ahead of a U.S. inflation report.
Stock futures for the Nasdaq 100 and S&P 500 swung between gains and losses and were trading 0.2% and 0.1% lower as of about 6.30 a.m. ET. European bourses tracked losses in Asia, with the FTSE 100 and France's CAC 40 both losing 0.6%, while Germany's DAX dropped 0.9%.
In Asia, the Shanghai SE Composite was down 0.6%, while Japan's Nikkei 225 fell 1.1% to 20,455.44, its weakest close since June 4.
Hong Kong's Hang Seng Index tumbled 2.1% as the territory closed its airport for a second day amid an occupation by protestors and the city's leader Carrie Lam warned that the ongoing political unrest could push the Asian financial hub into the "abyss."
Argentine assets remain in focus after a surprise poll loss for President Mauricio Macri led to slumping markets in the South American nation on Aug. 12, including a 13% slump in the peso while the benchmark MERVAL stock index sank nearly 38%. The opposition populists are seen as likely to undo Macri's market-friendly reforms that helped Argentina secure a record IMF bailout last year.
"The hit to risk assets globally was obvious yesterday, yet we expect the contagion to be limited and not long lasting as the [Argentine] woes should be seen as idiosyncratic event," ING analysts, led by head of foreign exchange strategy Chris Turner, said in a note.
Ten-year Treasury yields slipped 1 basis point to 1.63% after falling 9 basis points yesterday. German Bund yields dropped 2 basis points to negative 0.61%.
Yields on Italian bonds due in a decade fell 3 basis points to 1.67%. The Italian Senate will meet Aug. 13 to set the date for a confidence vote on Prime Minister Giuseppe Conte's government after failing to agree on a timetable a day earlier, delaying Deputy Prime Minister Matteo Salvini's bid to consolidate power through a snap election.
The Dollar Index, which measures the currency's performance against a basket of developed-market peers, was little changed after slipping 0.1% yesterday. A report later today is predicted to show that U.S. inflation accelerated to 1.7% in July from 1.6% in June.
Sterling advanced less than 0.1% against the dollar after a report showed average wages in the U.K. rose at the fastest pace in 11 years in the three months to June. The euro was little changed versus its U.S. counterpart after the latest ZEW institute survey showed that economic sentiment in Germany fell to the weakest level since 2010.
The Japanese yen ticked up 0.1% against the U.S. currency. Gold strengthened 1.1% to $1,526.96 per ounce.
Brent crude oil declined 0.2% to $58.44 per barrel on the ICE Futures Exchange.
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The day ahead:
8:30 a.m. ET — U.S. consumer price index (Econoday consensus: 0.2% month over month, 1.7% year over year)
8:55 a.m. ET — U.S. Redbook
7:50 p.m. ET — Japan machine orders (Econoday consensus: -1.0% month over month)
10 p.m. ET — China fixed asset investment, industrial production, retail sales