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European stocks fluctuated and the Chinese stock market fell after Beijing reimposed travel restrictions to curb the spread of variants of the delta coronavirus.
The STOXX 600 across Europe rose 0.2%, but the UK’s FTSE 100 fluctuated as investors waited for the results of the latest Bank of England meeting later on Thursday.
The Bank of England’s monetary policy committee is not expected to withdraw the massive stimulus it has pushed the economy through through a pandemic, despite rising inflation and strong growth prospects. However, the UK central bank may start planning for the definitive end of its bond buying program.
“NS [BoE’s] Deutsche Bank economists believe the exit strategies will make it clear that banks are focusing more on raising rates than increasing their inflated balance sheets. ”
The benchmark 10-year gilt yield was almost unchanged at 0.52%, but the pound rose 0.2% against the dollar to buy $ 1.3914.
In Asia, the Hang Seng index in Hong Kong fell 0.8% and the CSI 300 index listed in Shanghai and Shenzhen fell 0.6%. Indeed, China has imposed new domestic travel restrictions as cases of Delta variants have spread to 15 states.
Investors will also pay more attention to the U.S. jobs report on Friday after wages and services data released earlier this week gave various signals on the direction of the nation’s economic recovery. Economists polled by Bloomberg predict that the world’s largest economy will create 870,000 jobs in July, up from 850,000 in June. The unemployment rate is expected to drop from 5.9% in June to 5.7%.
The impression of strong employment will reinforce speculation that the U.S. Federal Reserve may start cutting monthly asset purchases that have supported the pandemic economy by $ 120 billion per month. “Given the growth in technical indicators, we expect the history of tapering to lead to stock market volatility,” said a Credit Suisse analyst.
A statement by two Fed officials on Wednesday suggests central banks are starting to prepare the ground for cuts to bond buying programs, ultimately raising interest rates from their all-time lows. Government bonds that rallied earlier in the day were sold accordingly. Thursday’s 10-year yield traded on Wednesday’s lows of 1.13% to 1.18%.
Elsewhere, a week-long drop as the global benchmark for Brent crude fell 0.1% and fears the spread of the virus could lower demand outweighed tensions with Iran, which supported the prices. Is almost 8%.
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European stocks drift as China imposes travel restrictions Source link European stocks drift as China imposes travel restrictions