Investors have been spooked by the possibility that the Federal Reserve could be forced to raise interest rates to reign in costs, which the central bank has hinted at. Fed officials have maintained a patient tone, but critics worry that inflation could be a bubble.
James Knightley, ING’s chief international economist, said the Fed’s surge in inflation had put pressure on the US central bank. Higher interest rates discourage risk-taking in markets, so high-flying stocks could be hit if inflation concerns outweigh them.
Strong inflation in the US had already caused a sensation in April and led to a cautious run on the May figures on Thursday in the event of a positive surprise. In Britain, the inflation data was greeted with a noticeable shrug.
After a positive start on Monday, Asian markets picked up where they left off today with China’s latest trade figures for June displaying a slowdown in imports and exports re-setting to May levels. On imports, the slowdown came as no surprise, with a 5.11% year-on-year increase, but acknowledged that this was due to the impact of the weaker figures last year, when the Chinese economy emerged from recession. In European markets, the Dax, Stoxx 600 and FTSE100 all set new record highs after a subdued session, but lagged behind the weak performance in travel and leisure stocks after the UK government confirmed the end of COVID restrictions on July 19.
Despite these key events, market sentiment remains subdued, with the MSCI index of the broadest range of global stocks at 715.79 points, well below the week’s record high of 718.19 points.
Ankit Gheedia, head of equity derivatives strategy for Europe at BNP Paribas, said he expected inflation to pick up in the coming months. U.S. stock futures were trading flat in early premarket trading ahead of the release of inflation data scheduled for today. On Wall Street, they were mixed, S & P calls were flat and the Nasdaq rose 0.2 percent.
US stocks rose to a record high after the Dow Jones settled above the 35,000 mark in the previous session. France’s CAC-40 index fell 0.1%, London’s FTSE 100 gained 0.3% and Germany’s Dax 30 slipped 1.1%. Oil prices also traded higher, with Brent crude futures up 0.9% to $74.82 a barrel and US WTI crude futures up 0.8% to $72.72 a barrel.
The FTSE 100 is off to a flat start after a quiet day with no futures, giving investors a glimpse of the start of the earnings season and inflation data. The index fell 8 points to 7,134, with brokers down 1.7% to 1,258p and marketing conglomerate up 16 per cent to 982p as the two biggest risers, suggesting that something is taking place in the advertising world.
According to London traders in the city, the London – BLICS – Index rose two points early in the morning after picking a positive result and three points higher at 7,125.42 after a late rally. On Wall Street, all three major indexes closed at record highs.
Stocks worldwide fell on Tuesday as traders remained unsettled by rising prices and the impact of inflation. The sell-off weighed on stocks around the globe, but a rebound in technology stocks softened the blow on Wall Street. A rebound in technology stocks in afternoon trading has softened the blow for Wall Street a bit overnight.
European markets are expected to open flat after their Asia-Pacific counterparts. All eyes will be on the Consumer Price Index (CPI) due to be released by 1 h 30 London time. On Wednesday, US stocks rose as traders weighed questions about the economy and sought clues about the next move by the Federal Reserve in the minutes of its latest meeting.
India reported a total of 3,087,743.70 confirmed cases, while Brazil confirmed 1,069.70. This morning the German CPI is expected to be confirmed at 2.1% and the French CPI at 1.9%.
Amazon was able to sell its debt at record low interest rates because the US government pays issuers. Amazon’s two-year bond yield is just 0.1 percentage points lower than the equivalent US Treasury yield.
Anderson said a car wash in the state of California without a water treatment plant like the one in Golden Bear can’t run. Car washes are prohibited from dumping used water into rain drains, making car washes more ecological than waiting for rain, Anderson said. The water, soap, pollutants and chemicals that flow down your driveway and into local waterways are unfiltered.
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