Global stocks tumbled on Wednesday, with technology stocks under pressure and investors torn between worries over inflation and optimism over economies pulling out of the Covid-19 pandemic.
Markets are waiting on the minutes of the Federal Reserve’s latest meeting due later.
A weak day in Asia saw the
drop 1.2% and Australia’s
Dow futures fell 200 points, while those for the
and Nasdaq-100 futures were down 0.7% and over 1%, respectively. Major U.S. stock indexes finished lower on Tuesday, as enthusiasm over a strong batch of retailer earnings competed with concerns over lofty valuations and signs of some inflationary pressures. Weaker-than-expected housing data didn’t help.
“Markets appear caught between concerns over rising cases and the spread of the India variant of coronavirus, and optimism over the so-called reopening trade, making it difficult to read the direction of the next move,” said Michael Hewson, chief market analyst at CMC Markets, in a note to clients.
Global yields were also rising, with that of the 10-year German bund up 1 basis point to -0.08% and the yield on the 10-year Treasury note up 2 basis points to 1.6599%.
The minutes of the Federal Open Market Committee meeting of Apr. 27-28 will be released later on Wednesday, with investors looking for any hints the central bank could be considering a shift in its accommodative monetary stance.
Adding to worries over global inflation, U.K. data showed consumer prices rose 1.5% on the year in April, twice the rate of inflation reported in March, according to the Office for National Statistics.
Oil prices were also under pressure, with crude and Brent futures dropping 1% each. Those losses came after data from the American Petroleum Institute reportedly showed an unexpected rise in U.S. crude supplies, and amid reports of potential progress on Iranian nuclear talks.
Technology names were under pressure, with heavily weighted semiconductor equipment provider
dropping over 2%. Shares of German business software group
Investors will get more earnings updates from the retail sector ahead of the open, with
all on tap. Multinational tech group
and clothing retailer
are among the names reporting after the close.
And Bitcoin prices were hovering just above $40,000, after dropping below that level earlier on Wednesday, following the People’s Bank of China’s warning that digital currencies can’t be used as payments.