Thursday July 4th

4-07-2019

European stocks subdued as Fed rate cut expectations grow

European stocks were subdued Thursday after weaker-than-expected U.S. economic data gave investors cause to anticipate that the Federal Reserve will cut interest rates at its upcoming July meeting. The pan-European Stoxx 600 traded fractionally above the flatline mid-morning, autos leading gains with a 0.8% climb while utilities stocks fell 0.9%. The Dow Jones Industrial Average and Nasdaq Composite both closed Wednesday’s session at all-time highs after U.S. private payrolls data fell significantly short of expectations, strengthening the Fed’s case for lowering rates at its monetary policy meeting at the end of July. Markets stateside are closed Thursday for the July 4 holiday and trading volumes in Europe are expected to be low. Stocks in Asia Pacific were mixed on Thursday as worse-than-expected U.S. economic data raised expectations the U.S. Federal Reserve could cut interest rates at its upcoming July meeting. The Nikkei 225 closed 0.3% higher at 21,702.45, while the Topix gained 0.65% to finish its trading day at 1,589.78. In South Korea, the Kospi advanced 0.61% to close at 2,108.73. Shares in mainland China slipped on the day, with the Shanghai compositeslipping 0.33% to 3,005.25 and the Shenzhen component 0.55% lower to 9,368.30. The Shenzhen composite also declined 0.548% to 1,591.24. In Hong Kong, the Hang Seng index was fractionally lower, as of its final hour of trading. Oil prices fell on Thursday, weighed down by data showing a smaller-than-expected draw on U.S. crude stockpiles and worries about the global economy. Front-month Brent crude futures, the international benchmark for oil prices, were down 49 cents or 0.77% at $63.33 per barrel by 0830 GMT. Brent closed up 2.3% on Wednesday. U.S. West Texas Intermediate (WTI) crude futures were down 47 cents or 0.82% at $56.87 per barrel. WTI closed up 1.9% on Wednesday. Gold prices edged lower on Thursday due to an uptick in the stock markets, while investors sought direction from upcoming U.S. non-farm payrolls data for more cues on Federal Reserve’s stance on rate cuts. Spot gold was 0.3% lower at $1,414.07 per ounce, as of 0731 GMT. U.S. gold futures were down 0.3% to $1,416.9 an ounce.