European Markets Caution Ahead of US Data
European stocks opened slightly lower at the start of this week, with the German DAX index falling 0.3%, the French CAC 40 and the UK FTSE 100 each losing 0.1%. These movements reflect investor caution ahead of the release of key US inflation data and speeches from several Federal Reserve officials, following last week's interest rate cut decision. Markets briefly rallied following the record close on Wall Street, but the rally has since subsided due to uncertainty about the future direction of interest rate policy.
Currently, market participants expect approximately 44 basis points of additional easing from the Fed by the end of the year. Several Fed officials are scheduled to speak this week, including John Williams, Thomas Barkin, Stephen Miran, Raphael Bostic, Michelle Bowman, and Jerome Powell. Their comments, coupled with economic data such as the PCE Index—the Fed's favorite inflation indicator, due out Friday—will determine market sentiment in the near term. Core PCE inflation is expected to rise to 2.8% from 2.6%.
In Asia, the People's Bank of China (PBOC) kept its benchmark lending rate unchanged for the fourth consecutive month, in line with market expectations. Meanwhile, US-China trade relations showed positive developments, with an agreement reached regarding TikTok's operations in the US. However, investors were also watching the Trump administration's latest immigration policy, which requires companies to pay $100,000 for H-1B visas—a rule that could potentially impact global hiring.
In the corporate sector, Ericsson announced a $1.3 billion contract to supply 5G equipment to VodafoneThree in the UK for eight years. In energy markets, oil prices rose 0.7% due to escalating tensions in the Middle East and the European Union's proposed new sanctions against Russia. News that four Western countries have recognized the state of Palestine further fueled the situation, increasing risks in the world's leading oil producer. (ads)
Source: Newsmaker.id
