- Asian, European, and US stocks retreated on Thursday morning as markets digested disappointing economic data out of Germany, France and South Korea.
- South Korea’s economy shrunk 0.3% in the first quarter, while German business sentiment and French manufacturing confidence both weakened in April.
- “The cautious mood from Asia is likely to roll over into Europe, and possibly Wall Street this afternoon, as investors adopt a guarded approach to riskier assets,” said Lukman Otunuga, research analyst at FXTM.
Asian, European, and US stocks retreated on Thursday as disappointing economic data in Germany, France, and South Korea fanned fears of a global slowdown. The bad news tempered investor excitement after Microsoft and Facebook continued a run of strong US earnings on Wednesday night.
South Korea’s economy shrunk 0.3% in the first quarter, surprising analysts who expected a 0.3% gain, according to Bloomberg. German business sentiment has also weakened in April, as the IFO economic institute reported its confidence index fell 0.5 points to 99.2 in April.
Meanwhile, French statistics agency Insee reported that manufacturing confidence fell 2.3 points to 101.1 in April – its lowest level since June 2015.
“Although earnings have been generally positive so far, the sustainability of any rally fuelled by strong earnings should be questioned, given how geopolitical risks and lingering growth concerns continue to strain risk sentiment,” said Lukman Otunuga, research analyst at FXTM.
“The cautious mood from Asia is likely to roll over into Europe, and possibly Wall Street this afternoon, as investors adopt a guarded approach to riskier assets.”
Here’s the market roundup as of 9.07 a.m. (4.07 a.m. EST):
- Asia: MSCI’s broadest index of Asia Pacific shares outside Japan was down 0.2%. China’s Shanghai Composite slid 2.4%, the SZSE Component dropped 3.2%, and Hong Kong’s Hang Seng fell 1%.
- Europe: Markets opened lower, as Germany’s DAX slipped 0.2%, Britain’s FTSE 100 slid 0.4%, and the Euro Stoxx 50 dropped 0.5%.
- US: Markets are set for a flat open as the futures underlying the Dow, S&P 500, and Nasdaq are trading within 0.2% of their opening levels.
- Oil: Prices continued to climb with US West Texas Intermediate (WTI) and Brent crude futures up 0.2% and 0.8% respectively.
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