Stocks slide as rate worries dent risk appetite
Updates prices, adds fresh commentary
By Naomi Rovnick and Ankur Banerjee
LONDON/SINGAPORE, May 24 (Reuters) -Global stocks slipped on Friday after robust U.S. and German economic data bolstered prospects of interest rates staying higher for longer on both sides of the Atlantic.
MSCI's global share index .MIWD00000PUS, which recently hit intraday highs after a rush into artificial intelligence stocks ignited by strong results from $2.6 trillion chipmaker Nvidia NVDA.O, fell 0.2% and was set for a 0.9% weekly loss.
Europe's Stoxx 600 share index .STOXX was 0.7% lower in early dealings, down 1% over the week.
Premier Miton Investors chief investment officer Neil Birrell said stock markets could enter a tug of war between strong economic growth and sustainably high interest rates reducing appetite for equities over fixed-income bonds.
"Earnings are strong but the bar for the sort of upside surprise needed to push markets higher is rising," he said.
"Bonds and equities are also very correlated at the moment and a rise in (U.S.) Treasury yields back towards 5% is the sort of thing people get worried about."
Stocks were shaken in October when the yield on the benchmark 10-year Treasury US10YT=RR hit 5%. This key debt yield, which climbs as the price of the security falls in response to expectations of higher interest rates, touched 4.498% on Thursday and was last at 4.475%.
Data on Thursday showed U.S. jobless claims dropped, while business activity was expanding faster than economists had expected.
In Europe, an official report on Friday confirmed earlier estimates that Germany's economy expanded by 0.2% in the first quarter of 2024, recovering from a contraction at the end of last year.
The strong U.S. economic data, along with hawkish minutes from the Federal Reserve's last meeting earlier in the week, led traders to dial back their bets on U.S. rate cuts this year.
Markets are now pricing in just 35 basis points (bps) of easing in 2024, versus expectations of 150 bps of cuts at the start of the year, with a rate cut fully priced-in only in December. FEDWATCH.
ECB CUT IN JUNE
The European Central Bank (ECB) has all but committed a rate cut in June but its policymakers have warned further easing may not be warranted because they expect inflation, which has moderated substantially, to hover above their 2% target until 2025.
The yield on Germany's 10-year bund DE10YT=RR, last at 2.59%, has risen by the most in a week since mid-April.
The dollar index =USD, which measures the U.S. currency against a basket of six major peers, is up more than 0.5% on the week to 105.06, its largest one-week rise since mid-April. FRX/.
The U.S. currency has gained about 0.5% against the euro this week and about 1% against the Japanese yen, JPY=EBS, which has weakened severely in recent months to 157 per dollar as the Bank of Japan kept monetary policy loose.
Data on Friday showed core inflation in Japan slowed for a second straight month in April, remaining above the central bank's 2% target but also signalling the BoJ would remain cautious about raising rates as consumer spending stays fragile.
Sterling GBP=D3 was muted on Friday at $1.269, having touched a two-month high of $1.2761 on Wednesday as traders pondered data showing inflation did not slow as much as expected in April.
British Prime Minister Rishi Sunak announced on Wednesday he was calling a general election, with polls showing a big lead for his Labour Party rival Keir Starmer, who may become the nation's sixth leader in eight years following intense political turmoil.
British government bonds have underperformed major peers this week, with the 10-year gilt yield UK10YT=RR 13 basis points higher and the interest rate sensitive two-year yield UK10YT=RR up 18 bps to 4.5%.
In commodities, oil prices were steady, with Brent crude LCOc1 at $81.27.
Gold prices XAU= rose 0.4% to $2338.52 per ounce but was heading for a 3.2% weekly decline for the week, its biggest weekly drop since December. GOL/
World FX rates YTD http://tmsnrt.rs/2egbfVh
Editing by Lincoln Feast, Michael Perry and Alex Richardson
To read Reuters Markets and Finance news, click on https://www.reuters.com/finance/markets For the state of play of Asian stock markets please click on: 0#.INDEXA
الأصول ذات الصلة
آخر الأخبار
إخلاء المسؤولية: تتيح كيانات XM Group خدمة تنفيذية فقط والدخول إلى منصة تداولنا عبر الإنترنت، مما يسمح للشخص بمشاهدة و/أو استخدام المحتوى المتاح على موقع الويب أو عن طريقه، وهذا المحتوى لا يراد به التغيير أو التوسع عن ذلك. يخضع هذا الدخول والاستخدام دائماً لما يلي: (1) الشروط والأحكام؛ (2) تحذيرات المخاطر؛ (3) إخلاء المسؤولية الكامل. لذلك يُقدم هذا المحتوى على أنه ليس أكثر من معلومات عامة. تحديداً، يرجى الانتباه إلى أن المحتوى المتاح على منصة تداولنا عبر الإنترنت ليس طلباً أو عرضاً لدخول أي معاملات في الأسواق المالية. التداول في أي سوق مالي به مخاطرة عالية برأس مالك.
جميع المواد المنشورة على منصة تداولنا مخصصة للأغراض التعليمية/المعلوماتية فقط ولا تحتوي - ولا ينبغي اعتبار أنها تحتوي - على نصائح أو توصيات مالية أو ضريبية أو تجارية، أو سجلاً لأسعار تداولنا، أو عرضاً أو طلباً لأي معاملة في أي صكوك مالية أو عروض ترويجية مالية لا داعي لها.
أي محتوى تابع للغير بالإضافة إلى المحتوى الذي أعدته XM، مثل الآراء، والأخبار، والأبحاث، والتحليلات والأسعار وغيرها من المعلومات أو روابط مواقع تابعة للغير وواردة في هذا الموقع تُقدم لك "كما هي"، كتعليق عام على السوق ولا تعتبر نصيحة استثمارية. يجب ألا يُفسر أي محتوى على أنه بحث استثماري، وأن تلاحظ وتقبل أن المحتوى غير مُعدٍ وفقاً للمتطلبات القانونية المصممة لتعزيز استقلالية البحث الاستثماري، وبالتالي، فهو بمثابة تواصل تسويقي بموجب القوانين واللوائح ذات الصلة. فضلاً تأكد من أنك قد قرأت وفهمت الإخطار بالبحوث الاستثمارية غير المستقلة والتحذير من مخاطر المعلومات السابقة، والذي يمكنك الاطلاع عليه هنا.