? Turkish lira continues to recover.
? Treasurys up ahead of U.S. retail data.
? Brent crude oil, gold fall.
? S&P 500 set to open lower.
European stock markets fell in early trading as Asian counterparts failed to track overnight gains on Wall Street. The FTSE 100 index was down 0.85% as of 6:34 a.m. ET and the Euro Stoxx 50 had shed 0.39%. Earlier, the Shanghai SE Composite lost 2.08% and Hong Kong's Hang Seng index was down 1.55% as shares in Asian game developers fell after Chinese regulators suspended game license approvals.
Tencent Holdings Ltd. closed 3.61% lower in Hong Kong before it reported quarterly earnings, while Nintendo Co. Ltd.'s stock tumbled 2.95% and Capcom Co. Ltd.'s shares were down 2.70% in Tokyo. The Nikkei 225 index shed 0.68%.
The Turkish lira climbed 2.97% against the dollar as the BDDK, the country's banking regulator, further limited banks' foreign-exchange swap transactions with foreign lenders to 25% of their equity, Reuters reported. The lira stood at 6.18 to the dollar, having earlier strengthened briefly to less than 6 to the dollar.
Turkey also announced plans earlier today to impose new tariffs on a variety of U.S. products such as rice, vehicles, alcohol, coal and cosmetics amid growing tensions between the two countries that have triggered the currency crisis and raised fears of contagion to other markets. Earlier, President Recep Tayyip Erdogan urged Turks to boycott U.S. electronic goods, especially iPhones.
"[The tariffs] will also increase the downward pressure on the lira, in turn causing greater pain to those Turkish corporates who have [foreign] currency denominated loans," said Michael Hewson of CMC Markets.
"As long as the crisis remains mainly isolated to Turkey, spillovers to the euro area and other G10 countries are likely to be muted," according to TD Securities. "For [the euro], the worst may be past unless the situation deteriorates dramatically."
The euro fell 0.27% and the yen was broadly flat against the dollar. Sterling dipped 0.17% as annual inflation in the U.K. edged up to 2.5% in July, in line with consensus estimates.
The Indonesian rupiah weakened 0.69% versus the dollar as Indonesia's central bank raised its key rate for the fourth time since May. The Chinese yuan depreciated 0.40% against the dollar.
Gold stayed below $1,200 per ounce, having breached the threshold for the first time since January 2017 earlier this week, and was down 0.79% to $1,184.66 per ounce.
"Although gold is perceived to be a safe-haven asset, it hasn't behaved much like one over the past week," Simona Gambarini of Capital Economics said in a research note. "There tends to be an inverse relationship between commodities prices and the value of the U.S. currency. But in the case of gold, this inverse relationship is even stronger as gold and the dollar can at times be considered substitutes."
Treasurys gained as 10-year yields fell by almost 3 basis points to 2.873% ahead of U.S. retail sales data that Société Générale said may give investors a clue on whether second-quarter strength carried over into the early third quarter. Department store chain operator Macy's Inc. is reporting earnings today.
Brent crude oil fell 0.72% to $71.94 per barrel on the ICE Futures Exchange. Futures point to the S&P 500 opening 0.47% lower.
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The day ahead:
8:30 a.m. ET — U.S. retail sales (Econoday consensus: 0.1% monthly)
8:30 a.m. ET — Empire State manufacturing survey (Econoday consensus: 20.0)
8:30 a.m. ET — U.S. productivity and costs (Econoday consensus: nonfarm productivity 2.5% quarterly, unit labor costs -0.2% quarterly)
9:15 a.m. ET — U.S. industrial production (Econoday consensus: 0.3% monthly)
10 a.m. ET — Atlanta Fed business inflation expectations
10 a.m. ET — U.S. business inventories (Econoday consensus: 0.1% monthly)
10 a.m. ET — U.S. housing market index (Econoday consensus: 68)
10:30 a.m. ET — U.S. Energy Information Administration petroleum status report
4 p.m. ET — U.S. Treasury international capital
7:50 p.m. ET — Japan merchandise trade (Econoday consensus: ¥70.0 billion deficit)
9:30 p.m. ET — Australia labor force survey