In the US, the Dallas Federal Reserve manufacturing activity index rose from -20 to -8.4 in January (survey: -15).
European sharemarkets closed mostly lower on Monday after data showed that Spain’s annual consumer prices rose by a higher-than-expected 5.8% in January, the first increase in six months, due to higher fuel prices (survey: 5%). Also dampening sentiment was a contraction in Germany’s gross domestic product (GDP), which unexpectedly fell 0.2% in the December quarter (survey: flat), heightening concerns about a recession. The lift in eurozone bond yields weighed on rate-sensitive stocks with technology sector shares down 1.7%. The continent-wide FTSEurofirst 300 index slid 0.2%. But the UK FTSE 100 index added 0.3% after consumer goods giant Unilever (+1.3%) announced a new chief executive officer.
US sharemarkets fell on Monday, dragged lower by declines in technology shares, as investors looked toward the US central bank’s interest rate decision and earnings from big tech companies. Shares of Apple (-2%), Amazon.com (-1.7%) and Google parent Alphabet (-2.5%), which are all due to post results later this week, all fell. Chipmaker Nvidia (-5.9%) and electric vehicle maker Tesla (-6.3%) also weighed on major indexes. Ford shares fell 2.9% after the automaker said its cutting prices and ramping up production of its Mustang Mach-E crossover. Shares of Johnson & Johnson slid 3.7% after the US federal appeals court rejected its talc-lawsuit strategy. At the close of trade, the Dow Jones index fell 261 points or 0.8%. The S&P 500 index shed 1.3%. And the Nasdaq index dipped 228 points or 2%.
US government bonds were weaker on Monday (yields higher). meeting of the year on Tuesday, with the central bank expected to raise benchmark rates by 25 basis points. US 10-year treasury yields rose 3 points to 3.55%. And US 2-year treasury yields lifted 4 points to 4.25%.
Major currencies were weaker against the US dollar in European and US trade. The Euro fell from highs near US$1.0912 to lows near US$1.0838 and was near US$1.0845 at the US close. The Aussie dollar dipped from highs near US70.96 cents to lows near US70.51 cents and was near US70.60 cents at the US close. And the Japanese yen eased from near 129.41 yen per US dollar to around JPY130.55 and was near JPY130.45 at the US close.
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Global oil prices extended losses on Monday, down around 2%. Looming increases to interest rates by major central banks and signs of strong Russian exports offset Middle East tensions over a drone attack in Iran and hopes for higher Chinese demand. The Brent crude oil price fell US$1.76 or 2% to US$84.90 a barrel. And the US Nymex crude oil price dipped US$1.78 or 2.2% to US$77.90 a barrel.
Base metal prices tumbled on Monday. The copper futures price fell 0.4% as investors assessed the outlook for demand in top consumer China ahead of the release of data from the country’s manufacturing sector. The aluminium futures price slid 1.7%.
The gold futures price fell US$6.50 or 0.3% to US$1,922.90 an ounce. Spot gold was trading near US$1,922 an ounce at the US close. Iron ore futures rose US38 cents or 0.3% to 7-month highs of US$123.08 a tonne as Chinese stockpiles fell.
Ahead:
In Australia, retail sales figures are released with private sector credit and consumer confidence data. In China, purchasing managers’ indexes (PMIs) are scheduled. In the US, the employment cost index is released with the FHFA house price index, S&P/Case-Shiller home prices, consumer confidence figures and the Chicago PMI.
Originally published by CommSec
