London (AFP) – Europe’s main stock markets declined in morning trade Tuesday as investors tracked unemployment numbers and looked ahead to US inflation data due later in the session.
Asian indices closed mixed in more quiet deals as the region marks the Lunar New Year holiday, while Wall Street enjoyed another record-high.
Elsewhere, bitcoin dipped below $50,000 after surpassing the level Monday for the first time in more than two years.
“Markets remained in a holding pattern, awaiting the next wave of inflation, manufacturing and GDP data to see if it is possible to second guess when central banks might press the magic ‘cut’ button on interest rates,” noted Russ Mould, investment director at AJ Bell.
“Stronger than expected labour data from the UK didn’t help matters as it effectively gives the Bank of England another reason to keep rates steady and not rush to cut them.”
France’s official jobless rate was stable at 7.5 percent for the final quarter of 2023, revised official data showed Tuesday.
Looking at the United States, traders are hoping that Tuesday’s consumer price index (CPI) reading in the world’s biggest economy shows a continued downward trend, which would give the Federal Reserve room to lower interest rates.
However, there is resignation on trading floors that a March cut is out of the question after decision-makers warned they wanted to see more positive indicators, with May now tipped as seeing the first shift downward for US borrowing costs.
The CPI report is forecast to come in below three percent on-year for the first time since March 2021, according to Bloomberg News.
Expectations inflation will come down to the Fed’s two-percent target this year, allowing the bank to ease monetary policy, have been a key driver of a market rally that has pushed the Dow and S&P 500 to multiple records this year.
In Asia, most of the region returned to work after a long weekend.
Tokyo led advances thanks to a surge in shares of Japanese investment group SoftBank, which was boosted by another blockbuster day for its US-listed chip designer Arm.
Arm has almost doubled in value in the past week — and trebled since its September listing — owing to healthy demand for semiconductors fuelled by an expected boom in artificial intelligence.
Bitcoin topped $50,000 Monday for the first time since late 2021 as investors grew optimistic that US approval of broader trading in the unit will ramp up demand.
The cryptocurrency has enjoyed a strong run in recent months, fuelled by expectations US lawmakers would allow the creation of exchange-traded funds (ETFs) that track the price and let the public invest in crypto without directly purchasing it.
After initially dropping in reaction to last month’s green light by Washington, bitcoin has rallied about 25 percent since January 22.
– Key figures around 1045 GMT –
London – FTSE 100: DOWN 0.2 percent at 7,557.15 points
Paris – CAC 40: DOWN 0.3 percent at 7,667.59
Frankfurt – DAX: DOWN 0.6 percent at 16,934.71
EURO STOXX 50: DOWN 0.8 percent at 4,706.89
Tokyo – Nikkei 225: UP 2.9 percent at 37,963.97 (close)
Hong Kong – Hang Seng Index: Closed for holiday
Shanghai – Composite: Closed for holiday
New York – Dow: UP 0.3 percent at 38,797.38 (close)
Euro/dollar: UNCHANGED at $1.0776 on Monday
Dollar/yen: UP at 149.53 yen from 149.33 yen
Pound/dollar: UP at $1.2664 from $1.2630
Euro/pound: DOWN at 85.09 pence from 85.29 pence
Brent North Sea Crude: UP 1.1 percent at $82.86 per barrel
West Texas Intermediate: UP 1.0 percent at $77.64 per barrel
