In a perfect storm of adverse developments suddenly sweeping the complacent and calm sea of manipulated global markets, overnight futures plunged, global stocks slumped, commodities tumbled, as investors rushed to the safety of Treasurys, sending yields sharply lower and pushing the dollar to the highest level since November,  amid concern the Federal Reserve may start tapering stimulus this year even as the delta virus variant undermines global growth. At 730 a.m. ET, Dow e-minis were down 0.92%, S&P 500 e-minis lower by 0.80% and Nasdaq 100 e-minis off 0.63%.

Suddenly dismal investor sentiment echoed in premarket trading where China-linked stocks including Alibaba Group plunged, sliding to a record low in Hong Kong trading. Luxury shares in Europe fell as China seemed to put its wealthiest on notice in favor of a “common prosperity.” Emerging-market equities plunged to this year’s low. All that meant a gauge of world stocks was poised for the worst week since February.  US equity futures took a sharp leg lower after the Nikkei reported that Toyota was set to slash output by 40% as a result of the escalating chip shortage…

Rising stagflation concerns, culminating with Goldman cutting its GDP forecast while hiking its inflation projections, sent energy stocks sliding as oil prices plunged to their lowest level in about three months. Chevron and Exxon Mobil fell 1.6% as oil sank to its lowest since May 21, pressured partly by a stronger U.S. dollar and a surprise increase in U.S. gasoline inventories.

MORE