Global: MARKETS-Stocks take a breather as tapering debate continues

ZhongAn Online P & C Insurance

12/08/2021 15:30

(Updates to U.S. open)
    * U.S indices fall at open
    * European stocks rise
    * Dollar close to four-month peak
    * U.S. Treasury yields rise

    By Matt Scuffham and Marc Jones
    NEW YORK/LONDON, Aug 12 (Reuters) - Global stock markets
took a breather on Thursday as investors weighed data showing a
steady jobs market recovery against a rise in producer prices,
with the debate continuing over when the Federal Reserve will
start to ease stimulus.
    A U.S. Labor Department report showed the number of
Americans filing new claims for unemployment benefits fell last
week, as expected, while a separate reading showed U.S. producer
prices rose more than expected through July.  urn:newsml:reuters.com:*:nL1N2PI23V
 urn:newsml:reuters.com:*:nL1N2PI133
    MSCI's gauge of stocks across the globe, which hit a record
high on Tuesday,  .MIWD00000PUS  shed 0.15%.
    U.S. stock indices were lower in early trade. The Dow and
S&P 500 had closed at record highs on Tuesday. 
    After an hour of trading, the Dow Jones Industrial Average
 .DJI  fell 90.81 points, or 0.26%, to 35,394.16, the S&P 500
 .SPX  lost 3.74 points, or 0.08%, to 4,443.96 and the Nasdaq
Composite  .IXIC  dropped 8.13 points, or 0.06%, to 14,757.01.
    European stocks, meanwhile, were attempting to equal their
longest winning streak since 2017. The pan-European STOXX 600
index  .STOXX  rose 0.01%. 
    Market chatter was still dominated by Wednesday's U.S.
consumer price inflation data. A slowdown in the pace of price 
increases took some heat out of speculation over when the
Federal Reserve might taper its massive bond buying program.
    "That makes it more likely that inflation will ease back to
the 2% target by itself and less likely that the Fed will have
to hike interest rates more aggressively than so far assumed,"
currency analysts at Commerzbank said in a note. 
    U.S. Treasury yields continued to rise.
    Benchmark 10-year notes  US10YT=RR  last /32 in price to
yield 1.359%, from 1.359% late on Wednesday.
    In the FX market, the dollar was still near a four-month
peak against major peers after it, too, retreated after the
inflation data.  /FRX 
    The dollar index  =USD  rose 0.117%, with the euro  EUR= 
down 0.09% to $1.1726.
    
 
    BEARS IN THE CHINA SHOP
    A significant number of U.S. earnings reports were due later
in the day. Walt Disney will report, along with Airbnb, Doordash
and Chinese internet giant Baidu, whose U.S.-listed shares have
more than halved since February as Beijing makes sweeping
regulatory changes.  .N 
    Asian shares dropped again overnight  .MIAPJ0000PUS ,
dragged down by a 0.8% fall in Chinese blue chips  .CSI300  and
a 0.5% drop in Hong Kong  .HIS  as weaker-than-expected China
lending data triggered liquidity concerns. 
    Among the biggest sliders was Chinese online insurer ZhongAn
 6060.HK , which fell 11.5% after state media said China's
banking and insurance regulator would step up scrutiny of online
insurance companies.  L4N2PJ14V  
    Nervous traders have been quick to respond to remarks from
Chinese state media and officials, after many were surprised by
last month's tougher-than-expected new rules for the private
tutoring sector https://www.reuters.com/world/china/chinas-tal-education-expects-hit-new-private-tutoring-rules-2021-07-25,
 one of several regulatory crack-downs that have roiled sectors
from technology to property https://www.reuters.com/world/china/education-bitcoin-chinas-season-regulatory-crackdown-2021-07-27.
 
    Whereas the main all-world stock indexes  .MIWD00000PUS 
have been hitting regular record highs, MSCI's main Asian
benchmark is now down more than 10% from its February peak. Some
Chinese stocks have lost nearly 90%.
    "The money is just in the U.S. and European markets right
now, and that's our preferred market too," said Daniel Lam,
senior cross-asset strategist at Standard Chartered Wealth
Management. 
    U.S. crude  CLc1  recently rose 0.01% to $69.26 per barrel
and Brent  LCOc1  was at $71.47, up 0.04% on the day.
    U.S. President Joe Biden's administration on Wednesday urged
the Organization of the Petroleum Exporting Countries and its
allies, known as OPEC+, to boost oil output to tackle rising
gasoline prices that they see as a threat to the global economic
recovery.  urn:newsml:reuters.com:*:nL1N2PI0S9
    Gold also declined. Spot gold  XAU=  dropped 0.3% to
$1,746.44 an ounce. U.S. gold futures  GCc1  fell 0.28% to
$1,745.50 an ounce.

    <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
World FX rates YTD    http://tmsnrt.rs/2egbfVh
Global asset performance    http://tmsnrt.rs/2yaDPgn
Asian stock markets    https://tmsnrt.rs/2zpUAr4
China stocks battered by Beijing's clampdown    https://tmsnrt.rs/3fRu52G
World stocks power higher    https://tmsnrt.rs/3iFbXuv
    ^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
 (Additional reporting by Devik Jain and Ambar Warrick in
Bengaluru;  Editing by Kim Coghill, David Holmes and Dan
Grebler)
 ((matthew.scuffham@thomsonreuters.com; +1-332-201-0609; Reuters
Messaging: matthew.scuffham.reuters.com@reuters.net))
 
((Graphic: Global asset performance http://tmsnrt.rs/2yaDPgn
Graphic: World FX rates http://tmsnrt.rs/2egbfVh
For Reuters Live Markets blog on European and UK stock markets, please click on:  LIVE/  ))