* U.S., Japan stock futures point to sharp falls
* Interbank futures imply rate cuts by Fed, RBA
* Stocks had worst week since 2008 last week
* Asian stock markets: https://tmsnrt.rs/2zpUAr4
By Tom Westbrook
SINGAPORE, March 2 (Reuters) - Stock futures plummeted on
Monday as investors were rattled by weekend data from China that
showed its fastest ever contraction in factory activity, raising
fears of a global recession from the coronavirus.
Pandemic fears pushed markets off a precipice last week,
wiping more than $5 trillion from global share market value as
stocks suffered their steepest slump in more than a decade.
The sheer scale of losses has prompted financial markets to
price in policy responses from the U.S. Federal Reserve to the
Bank of Japan and the Reserve Bank of Australia
(RBA). Futures now imply a full 50 basis point cut by the Fed in
March 0#FF: while Australian markets are pricing in a
quarter-point cut at the RBA's Tuesday meeting.
In equities, e-minis for the S&P500 ESc1 declined more
than 1% in early Asian trading while futures for Japan's Nikkei
NKc1 imply a 2% drop.
Australia and New Zealand shares were down 2.2% and 3.2%,
respectively, in early trade. .AXJO .NZ50
The implied yield on U.S. 10-Year Treasury futures traded
below 1% for the first time. "The outsized sell-off in risk assets and bid for safe
havens last week implies that markets are anticipating further
acceleration (of the virus' spread)," Barclays analysts said in
a note.
Investor panic last week sent bonds soaring and stocks
plunging. The S&P 500 index .SPX fell 11.5%, only its fifth
double-digit weekly drop since 1940. .N
Yields on U.S. government bonds, which fall when prices
rise, hit a record low 1.1160%. US/
Oil prices dropped to their lowest in more than a year and
even gold plunged as holders liquidated what they could to cover
margin calls on riskier investments. O/R GOL/
In currencies, investors sought shelter in the Japanese yen,
which jumped to a 20-week high on the dollar in tandem with a
massive shift in money markets, which now expect imminent rate
cuts in the United States. FEDWATCH
All of this leaves just about every major asset class on
edge and few analysts sounding optimistic.
"So it was right not to 'buy the dip,'" said Michael Every,
Rabobank's senior strategist for the Asia-Pacific.
The yen was last up 0.4% at 107.66.
The Aussie AUD=D3 and its New Zealand cousin NZD=D3
huddled near 11-year lows at $0.65 and $0.6224, respectively.
The euro EUR=D3 was up 0.3% at $1.1062.
That left the dollar index =USD off 0.2% at 97.911.
China's Caixin Purchasing Managers Index (PMI), due at 0145
GMT, and PMI figures from around the world due later on Monday
will add more detail to the picture of economic pain.
Later in the week, central bank meetings in Australia, on
Tuesday, and Canada, on Wednesday, will be closely watched.