Global Markets Mostly Sink With Inflation In Spotlight.
The outlook for inflation weighed heavily on world stock markets on Wednesday.
Asia sank after a slowing in US consumer inflation failed to dispel Covid fears, with Hong Kong being driven down by a collapse in casino stocks as Macau announced a planned crackdown on the industry.
Following overnight Wall Street losses, shares in Frankfurt and Paris fell in early afternoon eurozone trading.
London however edged higher at midday, despite data showing that UK annual inflation spiked to a nine-year peak of 3.2 percent in August.
That happened just one day after data showed that US inflation fell to 5.3 percent in August, down from a 13-year high.
Concerns that central banks will stop Covid support efforts to manage inflation have caused markets to swing this year.
Policymakers stress that higher costs are just transitory, but investors are skeptical.
“With predictions for tapering and rate hikes, inflation is obviously becoming a big concern,” OANDA analyst Craig Erlam told AFP.
“While the current downturn in the US provides some respite, the Fed is still projected to taper this year, and more tightening is not far behind.”
Inflation fears, Erlam noted, might “serve as a headwind for equities markets in the latter months of the year.”
After a bright start to September, most equities around the world have also gone into reverse in recent sessions as confidence is shaken by the Delta coronavirus variant.
A number of countries have faced a worrying jump in new cases that have forced some, including China, to reimpose tough containment measures.
Investors are also having to grapple with a range of other issues including China’s regulatory crackdown on private enterprises, including the high tech sector.
Asian markets were under pressure, with below-par retail sales data a further indication that the pace of growth in China’s economy continued to slow in August.
Losses were topped by Hong Kong, with Macau casino operators falling as the latest to be caught in China’s regulatory crosshairs.
Meanwhile, fears of a probable default by Chinese property behemoth Evergrande, whose debts total more than $300 billion, are causing widespread concern.
London – FTSE 100: UP 0.1 percent at 7,038.82 points
Frankfurt – DAX 30: DOWN 0.2 percent at 15,685.40
Paris – CAC 40: DOWN 0.6 percent at 6,616.11
EURO STOXX 50: DOWN 0.4 percent at 4,173.77
Tokyo – Nikkei 225: DOWN 0.5 percent at 30,511.71 (close)
Hong Kong – Hang Seng Index: DOWN 1.8 percent at 25,033.21 (close)
Shanghai – Composite: DOWN 0.2 percent at 3,656.22 (close)
New York – Dow: DOWN 0.8 percent at 34,577.57 (close)
Euro/dollar: UP. Washington Newsday Brief News.