Breaking News
Investing Pro 0
NEW! Get Actionable Insights with InvestingPro+ Try 7 Days Free

U.S. Opening Bell: Inflation Fears Push Stocks To 6-Week Low; USD, Gold Firm

By (Pinchas Cohen/ OverviewMay 13, 2021 11:59
U.S. Opening Bell: Inflation Fears Push Stocks To 6-Week Low; USD, Gold Firm
By (Pinchas Cohen/   |  May 13, 2021 11:59
Saved. See Saved Items.
This article has already been saved in your Saved Items
  • Global markets plunge after US equity slump on Wednesday
  • Oil slides 
  • Bitcoin tumbles 

Key Events

On Thursday, futures on the Dow, S&P, NASDAQ and Russell 2000 were all trading in the red and European shares opened lower, with global stocks at their lowest since early April. Spiking US inflation heightened concerns that the economic recovery may be at an impass.

Treasury yields rallied.

Global Financial Affairs

Global markets remain under pressure with the MSCI World Index lower for the fourth consecutive day. In Europe, the STOXX 600 Index dropped 1% right out of the gate, weighed by slumping commodity prices and a strengthening dollar, after US consumer prices recorded their biggest jump in in almost 12 years in April, reigniting concerns that the Fed will have to backtrack on its promise and raise interest rates. 

STOXX 600 Daily
STOXX 600 Daily

The pan-European benchmark was down 1.6% at the time of writing, its lowest level since Apr. 1. The index is completing a small top, after having violated its uptrend line since the late-October low, as the price heads towards the uptrend line since the famous 2020 bottom, guarded by the 200 DMA.

The UK's FTSE 100 also slid, dropping 2.1% at the time of writing, to the lowest since Apr. 6. However, from a technical perspective it seemed in a better position than its continental peer.

FTSE 100 Daily
FTSE 100 Daily

While the price did fall below its uptrend line since late October, Briton's leading benchmark has not yet decisively topped out, and may have found support by the January highs.

British luxury retailer, Burberry (LON:BRBY) plunged 8% after it announced a 10% drop in the company’s annual sales, a result of pandemic shutdowns. Telecom and broadband provider BT Group (LON:BT) also declined, after reporting a 7% slide in revenue and 6% drop in annual adjusted earnings.

British financial services group Hargreaves Lansdown (LON:HRGV) was lower as well, despite reporting record new business in the first quarter, as people increased their savings during the coronavirus lockdowns.

Asian markets sank this morning and regional gauges were on course for a technical correction. The MSCI Asia Pacific fell as much as 1.5%, which means it has fallen 10% from its Feb. 17 high, erasing all gains YTD.

On Wednesday during the Wall Street session, US stocks posted their sharpest selloff since February, after the inflation report surprised traders. The Technology sector—which has been enjoying the highest market valuations—continued to sell off, leading the market lower. Big tech names like Apple (NASDAQ:AAPL) and Microsoft (NASDAQ:MSFT) shed over 2%. Energy (+0.5%) was the only sector in the S&P 500 Index in the green. Consumer Discretionary (-3.4%) underperformed.

The CPI release confirmed investors worst fears and dispelled the Feds’ too-oft repeated promise of lower for longer, which pushed yields higher.

The 10-year Treasury note yield soared above 1.7% intraday, closing at 1.693% for the first time since Apr. 5. 

10-year Treasuries Daily
10-year Treasuries Daily

The jump took rates back above the extended neckline of a top. It also meant rates broke out of their falling channel.

The outlook for higher rates boosted the dollar, offsetting concerns of its weakening buying power, as traders are confident the Fed will raise rates, promises or not. 

Dollar Index Daily
Dollar Index Daily

The USD stabilized after bouncing back above its uptrend line. It continues to struggle between the recent, smaller bearish wedge and the earlier, massive bullish wedge (based on our interpretation having followed a cataclysmic rise).

The stronger dollar pushed non-yielding, gold lower.

Gold Daily
Gold Daily

The yellow metal fell away from the area where the top of the falling channel since the 2020 peak and the top of the rising channel since the late-March low converged.

Bitcoin plunged after Elon Musk added to the gloom on the cryptocurrency when he said Tesla (NASDAQ:TSLA) will no longer accept Bitcoin as payment for its EV cars due to the “rapidly increasing use of fossil fuel for Bitcoin mining and transactions.”

Bitcoin Daily
Bitcoin Daily

The digital currency completed its second bearish wedge in a row, as it completes a H&S top, whose downside breakout is aiming at the low $30,000s. Bitcoin enjoyed a 65% increase in value between Feb. 8 and Apr. 14 after Tesla’s announcement that it had purchased $1.5 billion of Bitcoin and will accept the digital currency as payment.

Oil fell as the Colonial Pipeline, the largest oil products conduit in the US including gasoline, which was hacked last week, restarted operations. The impact of the outage isn't fully clear at this point but it could potentially impact prices and supply going forward.

Oil Daily
Oil Daily

The WTI fell from the top of a rising channel that is challenging the Mar. 8 peak.

Up Ahead

  • The US PPI release will be viewed with interest today after yesterday’s CPI surprise.
  • Bank of England Governor Bailey speaks today. 
  • On Friday, the ECB Monetary policy statement is released.
  • US retail sales figures are reported on Friday.

Market Moves


  • Futures on the S&P 500 Index decreased 0.3%.
  • The FTSE 100 Index dropped 1.9%.
  • The STOXX 600 Index declined 1.3%.
  • The MSCI Asia Pacific Index fell 1.4%.
  • The MSCI Emerging Market Index dipped 1.2%.


  • The Dollar Index declined 0.1%.
  • The British pound was little changed at $1.4061.
  • The euro jumped 0.2% to $1.2098.
  • The onshore yuan strengthened 0.1% to 6.452 per dollar.
  • The Japanese yen was little changed at 109.64 per dollar.


  • The yield on 10-year Treasuries sank one basis point to 1.68%.
  • The yield on two-year Treasuries decreased less than one basis point to 0.16%.
  • Britain’s 10-year yield gained one basis point to 0.893%.
  • Germany’s 10-year yield increased one basis point to -0.12%.
  • Japan’s 10-year yield climbed one basis point to 0.092%.


  • West Texas Intermediate crude declined 1.5% to $65.06 a barrel.
  • Brent crude declined 1.5% to $68.29 a barrel.
  • Gold strengthened 0.2% to $1,818.52 an ounce.
U.S. Opening Bell: Inflation Fears Push Stocks To 6-Week Low; USD, Gold Firm

Related Articles

U.S. Opening Bell: Inflation Fears Push Stocks To 6-Week Low; USD, Gold Firm

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind: 

  • Enrich the conversation
  • Stay focused and on track. Only post material that’s relevant to the topic being discussed.
  • Be respectful. Even negative opinions can be framed positively and diplomatically.
  •  Use standard writing style. Include punctuation and upper and lower cases.
  • NOTE: Spam and/or promotional messages and links within a comment will be removed
  • Avoid profanity, slander or personal attacks directed at an author or another user.
  • Don’t Monopolize the Conversation. We appreciate passion and conviction, but we also believe strongly in giving everyone a chance to air their thoughts. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Arman Khan
Arman Khan May 13, 2021 22:09
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Our Apps
© 2007-2022 Fusion Media Limited. All Rights Reserved.
Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
  • Sign up for FREE and get:
  • Real-Time Alerts
  • Advanced Portfolio Features
  • Personalized Charts
  • Fully-Synced App
Continue with Google
Sign up with Email