U.S. stock futures dropped Monday after China took a series of steps pointing to further tensions between the world’s top two economies.
The decline came after a solid week for U.S. benchmarks, in which the S&P 500
rose 2% to finish at its 40th record close of 2021, and the tech-heavy Nasdaq Composite
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
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
skidded over 4%, following a crackdown both on Tencent’s music licensing and the entire tutoring industry. In premarket trade, Tencent Music Entertainment
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.
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.