London (AFP) – US and European stock markets wobbled Wednesday as key US inflation data showed an uptick, with traders also weighing Donald Trump’s tariff threats and a political standoff in France. Wall Street saw red, with the tech-heavy Nasdaq falling more than one percent two hours into the session, with recent darling Nvidia off three percent, while the Dow and the broad-based S&P 500 index also slid on the eve of the Thanksgiving holiday.
European stock markets were also mindful of rising concerns that Europe could be the next tariff target for US president-elect Donald Trump. The Paris stock market ended off 0.7 percent as a French political standoff over a belt-tightening draft budget for 2025 threatens to topple the government. Frankfurt also dipped, while London just finished in the green.
In the United States, the personal consumption expenditures (PCE) price index rose 2.3 percent in the 12 months to October, up from 2.1 percent in September, which was broadly in line with forecasts. The figure was also close to the Fed’s long-term target of two percent, keeping the bank’s inflation fight largely on track. Kathleen Brooks, research director at XTB, said the figure “is a little hot” but “it is not outside the most recent range for monthly increases.” “US traders can pack up for the Thanksgiving holiday with little to fear at this stage,” she said in a research note.
Trump, who has named a tough-negotiating hawk to be his trade envoy when he takes office in January, has announced plans to hit China, Canada, and Mexico with hefty tariffs from January. “Investors are growing increasingly concerned that Donald Trump’s next tariff target is continental Europe,” said Dan Coatsworth, investment analyst at AJ Bell. For Europe, this would create “another potential headwind on top of the existing one in the form of lacklustre economic activity,” he said. While Trump’s victory has been broadly welcomed by the financial markets, there is concern that his widely pledged rise in tariffs could be inflationary. Trump has announced Jamieson Greer as his trade envoy, saying he played a “key role” in imposing tariffs on China during his previous term in office.
Elsewhere, oil prices were flat after sliding on news that Israel and Hezbollah in Lebanon had agreed to a ceasefire. Crude steadied as traders expect key OPEC+ nations to delay a pick-up in production, which was due to begin in January, when they meet Sunday. Bitcoin moved back past $95,000 after a rise of more than four percent, having hit a record Friday and come within a whisker of the $100,000 mark on hopes that Trump will move to ease restrictions on the crypto market.
After another record-breaking lead from earlier, Chinese markets rallied as data showed that China’s industrial sector narrowed losses in October. Meanwhile, the price of Arabica coffee hit the highest level since 1977 on concerns of limited supplies caused by drought in Brazil this year.
**Key figures around 1645 GMT**
New York – Dow: DOWN 0.1 percent at 44,810.66 points
New York – S&P 500: DOWN 0.5 percent at 5,989.28
New York – Nasdaq: DOWN 1.1 percent at 18,955.09
London – FTSE 100: UP 0.2 percent at 8,278.41 (close)
Paris – CAC 40: DOWN 0.7 percent at 7,142.68 (close)
Frankfurt – DAX: DOWN 0.2 percent at 19,261.70 (close)
Tokyo – Nikkei 225: DOWN 0.8 percent at 38,134.97 (close)
Hong Kong – Hang Seng Index: UP 2.3 percent at 19,603.13 (close)
Shanghai – Composite: UP 1.5 percent at 3,309.78 (close)
Euro/dollar: UP at $1.0576 from $1.0482 on Tuesday
Pound/dollar: UP at $1.2676 from $1.2567
Dollar/yen: DOWN at 150.73 yen from 153.06 yen
Euro/pound: UP at 83.42 pence from 83.41 pence
Brent North Sea Crude: FLAT at $72.81 per barrel
West Texas Intermediate: UP 0.1 percent at $68.84 per barrel
© 2024 AFP
