Agencies
Global stock markets mostly slipped Tuesday ahead of a slew of US economic data releases and tech earnings, and as bond yields rose. The main US stock indexes were slightly lower after the start of trading, giving up their gains from Monday. Shares were also mostly lower in Europe.
Yields on 10-year US Treasuries have inched up to above 4.3 percent this week, the highest since early July, indicating that market participants are increasingly counting on more limited rate cuts from the Federal Reserve.
The higher rates, which hurt company earnings and deter investors from taking money out of savings accounts to invest in the stock market, could also reflect unease about the deficit spending plans of both candidates in next Tuesday’s presidential elections, said Joe Mazzola, a strategist at Charles Schwab.
"The relentless climb in Treasury yields continues and threatens to overshadow any news, good or bad, on the earnings front,” he said. Alphabet reports earnings after the market closes and many investors are awaiting to hear what the Google-parent has to say before taking any bets."When a mega-cap stock reports earnings, the stock market pays extra attention not only to the report itself, but also to any guidance,” said Patrick O’Hare, an analyst at Briefing.com. In total, five of the "Magnificent Seven” US tech giants will report this week, including Amazon, Apple, Facebook-parent Meta, and Microsoft.
On the economic front, the US government will release third quarter GDP growth estimates Wednesday, as well as inflation data Thursday and the closely watched monthly labor market report Friday. Together, they should provide more clues about the health of the world’s largest economy and the direction of its Fed’s interest rate policy.
Major European stock markets were lower in mid-afternoon trading while Asian markets ended mixed. London shed 0.5 percent as investors awaited the first budget of Britain’s new Labor government on Wednesday, expected to include tax rises on businesses.
Adidas shares were up more than 2 percent in Frankfurt after the sportswear giant again raised its full-year revenue outlook.
Oil prices recovered some of Monday’s losses after the US government said it would add to its Strategic Petroleum Reserve.
Crude prices had tumbled at the start of the week on relief that Zionist entity’s weekend strikes on Iran spared the country’s energy infrastructure. Bitcoin rose above $71,000 to levels last seen in June on expectations that Donald Trump, who has sought the support of the crypto-currency world, will win next week’s elections. "Trump’s campaign appears to be building upside momentum, and that’s going down well with the crypto bros,” said David Morrison, analyst at Trade Nation.
In Asia, Tokyo and Hong Kong stocks climbed but Shanghai and Singapore retreated. Japanese shares built on the previous day’s gains as cheaper oil and the weaker yen outweighed uncertainty after Japan’s ruling coalition fell short of a majority in Sunday’s general election.
Investors are awaiting the Bank of Japan’s rate decision later this week, with the central bank expected to stand pat following two hikes earlier this year.