TOKYO (AP) – Global shares mostly declined in cautious trading yesterday ahead of earnings reports around the globe, as Wall Street’s long, record-breaking rally lost steam.
France’s CAC 40 lost 0.3 per cent to 7,516.20, while the German DAX rose 0.4 per cent to 19,526.85. Britain’s FTSE 100 fell 0.5 per cent to 8,281.14. The futures for the S&P 500 and the Dow Jones Industrial Average were down 0.3 per cent.
In Asian trading, Japan’s benchmark Nikkei 225 dropped 1.4 per cent to finish at 38,411.96. Australia’s S&P/ASX 200 fell 1.7 per cent to 8,205.70, while South Korea’s Kospi slipped 1.3 per cent to 2,570.70.
Hong Kong’s Hang Seng gained 0.1 per cent to 20,498.95 and the Shanghai Composite rose 0.5 per cent to 3,285.87 following a cut to interest rates that took effect on Monday.
“The next two weeks are set to be a wild ride. Volatility has surged across stocks, bonds, and currencies as investors brace for a perfect storm of risks: a hotly contested United States (US) election, critical interest-rate decisions in both the US and Europe, the looming threat of a wider Middle East conflict, and the ever-present pressure of quarterly earnings,” managing partner at SPI Asset Management Stephen Innes said in a commentary.
On Monday, the S&P 500 slipped 0.2 per cent and the Dow dropped 0.8 per cent. The Nasdaq composite rose 0.3 per cent.
Wall Street’s rally to records this year has been based on hopes the US economy can escape from the worst inflation in generations without a painful recession that many investors had worried could be inevitable.
With the Federal Reserve now cutting interest rates to keep the economy humming, optimists hope stocks can rise even further. But critics warned stock prices look too expensive given they’ve climbed faster than corporate profits.
That puts pressure on companies to deliver growth in profits to justify their stock prices, and more than 100 companies in the S&P 500 are scheduled to give details this week about their performances during the summer. That includes such heavyweights as AT&T, Coca-Cola, IBM, General Motors and Tesla.
In energy trading, benchmark US crude lost 20 cents to USD69.84 a barrel. Brent crude, the international standard, fell 18 cents to USD74.11 a barrel.In currency trading, the US dollar rose to JPY150.99 from JPY150.69. The euro rose to USD1.0829 from USD1.0819.
