US Futures Steady as French Stalemate Brings Calm: Markets Wrap

　　(Bloomberg) -- Calm returned to markets as traders saw positive implications from an inconclusive French election outcome that still kept the far right at bay. European stocks rose and the euro pared earlier losses.

　　Contracts on the S&P 500 were little changed on Monday following its biggest weekly advance since April. US Treasuries started off the week on the backfoot, as traders brace for Federal Reserve Chair Jerome Powells congressional testimony and US inflation data this week.

　　A left-wing coalition chalked up the most votes in French legislative elections on the weekend, but failed to secure enough seats to form a government. That outcome limits how much any party can do, leading to bets that President Emmanuel Macron will form a new coalition between the center and center-left.

　　“A hung parliament is not necessarily a bad outcome because it means that the most extreme policies are less likely to make it to the legislature,” said Azad Zangana, a senior European economist at Schroders. “Its still a very uncertain period going forward.”

　　In the runup to the vote, investors had been concerned about the prospect of a far-right takeover after Macron‘s crushing defeat in last month’s European parliamentary elections.

　　Powell‘s testimony on Tuesday and Wednesday will be closely watched ahead of Thursday’s consumer price figures for June. The Fed Chair is likely to say policymakers need further confirmation they have vanquished inflationn before theyre ready to cut interest rates when he speaks to Congress.

　　Earnings from major US banks including JPMorgan Chase & Co. are also due this week. In other corporate news, Boeing Co. agreed to plead guilty to criminal conspiracy to defraud the US after the Justice Department concluded the planemaker failed to adhere to an earlier settlement stemming from two crashes of its 737 Max jetliner.

　　Meanwhile, President Joe Bidens continues to salvage his embattled reelection bid, fending off calls from Democratic lawmakers to step aside. Biden registered his best showing yet in a Bloomberg News/Morning Consult tracking poll of battleground states, even as voters offered withering appraisals of his debate performance.

　　In commodities, oil edged lower after four straight weekly gains, even as traders tracked twin threats to crude production posed by a hurricane in the US and wildfires in Canada. Gold was steady, and iron ore extended a decline from a one-month high.

　　Story continues

　　Key events this week include:

• Indian Prime Minister Narendra Modi visits Moscow, Monday
• Fed Chair Jerome Powell delivers semi-annual testimony to the Senate Banking Committee, Tuesday
• US Treasury Secretary Janet Yellen testifies to the House Financial Services Committee, Tuesday
• Fed Vice Chair for Supervision Michael Barr, Governor Michelle Bowman speak, Tuesday
• China PPI, CPI, Wednesday
• Japan PPI, Wednesday
• Fed Chair Jerome Powell testifies to the House Financial Services Committee, Wednesday
• Chicago Fed President Austan Goolsbee and Fed Governor Michelle Bowman speak, Wednesday
• BOE chief economist Huw Pill, BOE policy maker Catherine Mann speak, Wednesday
• US CPI, initial jobless claims, Thursday
• Atlanta Fed President Raphael Bostic, St. Louis Fed President Alberto Musalem speak
• Japan industrial production, Friday
• China trade, Friday
• US University of Michigan consumer sentiment, PPI, Friday
• Citigroup, JPMorgan, Wells Fargo and Bank of New York Mellon report quarterly earnings, Friday

　　Some of the main moves in markets:

　　Stocks

• S&P 500 futures were little changed as of 7:12 a.m. New York time
• Nasdaq 100 futures were little changed
• Futures on the Dow Jones Industrial Average were little changed
• The Stoxx Europe 600 rose 0.4%
• The MSCI World Index was little changed

　　Currencies

• The Bloomberg Dollar Spot Index was little changed
• The euro fell 0.1% to $1.0828
• The British pound was little changed at $1.2822
• The Japanese yen was little changed at 160.90 per dollar

　　Cryptocurrencies

• Bitcoin fell 0.2% to $57,170.05
• Ether rose 1.3% to $3,037.82

　　Bonds

• The yield on 10-year Treasuries advanced two basis points to 4.30%
• Germanys 10-year yield was little changed at 2.56%
• Britains 10-year yield was little changed at 4.13%

　　Commodities

• West Texas Intermediate crude fell 1% to $82.34 a barrel
• Spot gold fell 0.7% to $2,374.68 an ounce