Major stock markets edged down on Monday as investors braced for potential signs of sustained inflation and waited for the next season’s growth prospects for corporate earnings.
London, Frankfurt and Paris all fell at the close, and in New York, the Dow Jones index also posted a slight loss in afternoon trading.
Asian stocks fell earlier in the day after U.S. Federal Reserve boss Jerome Powell reiterated his view the economy was improving – but warned the deadly coronavirus still posed a risk.
Bitcoin fell below $ 60,000 before the IPO of Coinbase, America’s largest cryptocurrency exchange.
Investors are now awaiting the release of the US Consumer Price Index on Tuesday to get a sense of whether a massive US stimulus package and a global economic recovery could generate a sustained surge in inflation.
“The publication of the CPI on Tuesday will therefore be important for the dollar and the markets in general,” noted Fawad Razaqzada, market analyst at ThinkMarkets.
Experts fear that inflation may force central banks to cut back generous monetary policies that have helped fuel a long period of stock market gains.
Then, “with the first quarter results season in the United States underway this week, we are finally seeing how far companies have come since the (coronavirus) crisis began,” said analyst Joshua Mahony of the company. of IG trading.
“US banks are taking center stage for this first week,” he said, noting investors would closely follow news of any exposure to ailing hedge fund Archegos Capital Management.
JPMorgan and Goldman Sachs are due to release their results on Wednesday, followed by Morgan Stanley on Friday.
Razaqzada will seek to see if “CEOs (CEOs) of companies reflect investor optimism on the economic outlook, or will they provide more moderate forecasts?”
– Clearer perspectives –
Markets started the week by reflecting on comments from Fed chief Powell, who told CBS television that the world’s largest economy was on its way back to life, while remaining cautious.
“The outlook has improved dramatically,” he said, adding, “I repeat though, there are real risks.”
Powell and other policymakers agree that the recovery is likely to fuel inflation.
But despite lingering market fears that the bank will have to raise interest rates, they insist that monetary policy will remain very favorable until the economy has firmly recovered.
– Key figures around 1600 GMT –
New York – Dow: Down 0.1% to 33,767.12 points
EURO STOXX 50: -0.4 percent to 3,961.90
London – FTSE 100: Down 0.4% to 6,889.12 (close)
Paris – CAC 40: – 0.1% to 6161.68 (closing)
Frankfurt – DAX 30: DOWN 0.1% to 15,215.00 (close)
Tokyo – Nikkei 225: Down 0.8% to 29,538.73 (close)
Hong Kong – Hang Seng Index: down 0.9% to 28,453.28 (close)
Shanghai – Composite: DOWN 1.1% to 3,412.95 (close)
Euro / dollar: UP to $ 1.1907 from $ 1.1899 at 9:00 p.m. GMT
Pound / dollar: UP to $ 1.3739 from $ 1.3707
Euro / pound: LOW at 86.67 pence from 86.81 pence
Dollar / yen: LOW at 109.42 yen vs. 109.67 yen
North Sea Brent: + 0.5% to $ 63.27 per barrel
West Texas Intermediate: + 0.6% to $ 59.70 per barrel
dan-rfj / wai / lc