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U.S. stock futures dropped Monday after China took a series of steps pointing to further tensions between the world’s top two economies.
E-mini S&P 500 futures
ES00,
slipped 0.3%, and Nasdaq 100 futures
NQ00,
dropped 0.2%. The futures on the Dow industrials
YM00,
fell 175 points.
The decline came after a solid week for U.S. benchmarks, in which the S&P 500
SPX,
rose 2% to finish at its 40th record close of 2021, and the tech-heavy Nasdaq Composite
COMP,
rose 2.8% ahead of earnings from major tech companies including Alphabet, Amazon, Apple, Facebook and Microsoft.
The U.S. earnings calendar includes electric-vehicle maker Tesla
TSLA,
which reports after the close on Monday. This week also will see the latest Federal Reserve interest-rate decision and the gross domestic product report for the second quarter.
The major markets action on Monday was tied to China, as the Hang Seng
HSI,
skidded over 4%, following a crackdown both on Tencent’s music licensing and the entire tutoring industry. In premarket trade, Tencent Music Entertainment
TME,
shares dropped 14% after China ordered the company to end exclusive contracts with music copyright holders.
Hong Kong-listed education stocks skidded after educational training institutions were banned from raising money in the stock market and foreign capital cannot invest. The crackdown slammed U.S.-listed Chinese education stocks on Friday.
The crackdown came as China blamed the U.S. for a stalemate in bilateral relations as high-level talks began in the Chinese city of Tianjin.
Bitcoin
BTCUSD,
jumped Monday after Amazon ran an advertisement looking for an individual to lead the retailer’s cryptocurrencies effort. A separate report said Amazon was looking to start accepting bitcoin for payment by the end of the year.
A long-awaited bipartisan deal on U.S. infrastructure could be reached Monday.
