Global Markets: Equity markets edge up, oil drops, on growth worries ahead of Fed meeting

By David Randall NEW YORK (Reuters) - World stock markets inched higher on Tuesday as investors looked ahead to whether the U.S.

Reuters December 19, 2018 00:05:59 IST
Global Markets: Equity markets edge up, oil drops, on growth worries ahead of Fed meeting

Global Markets Equity markets edge up oil drops on growth worries ahead of Fed meeting

By David Randall

NEW YORK (Reuters) - World stock markets inched higher on Tuesday as investors looked ahead to whether the U.S. Federal Reserve will be able to raise interest rates much further amid turbulent markets and a weakening outlook for the global economy.

Steep declines in equity markets over the last two months have sapped investor confidence, spurring fund managers to predict global growth to weaken over the next 12 months, the worst outlook in a decade, Bank of America Merrill Lynch's December investor survey showed.

MSCI's world stock index rose 0.2 percent. The index has fallen 10 percent this year and is set for its worst year in a decade.

U.S. stocks were boosted by upbeat earnings and tech companies. The Dow Jones Industrial Average rose 303.08 points, or 1.28 percent, to 23,896.06, the S&P 500 gained 24.51 points, or 0.96 percent, to 2,570.45 and the Nasdaq Composite added 84.39 points, or 1.25 percent, to 6,838.12.

Still, the benchmark S&P 500 index began the trading session almost 8 percent lower for December.

"We're facing the biggest December fall in U.S. stocks since 1931 and this is striking and worrying at the same time," said Chris Bailey, European strategist at international financial services firm Raymond James. "We are at a regime shift moment and the debate is how big that regime shift will be."

A speech by Chinese President Xi Jinping, which investors had hoped could lift morale, had little impact, with Chinese shares falling over 1 percent. Japan's Nikkei lost 1.8 percent.

In addition, the German Ifo economic institute's business climate index fell for the fourth month in a row to its lowest level in more than two years and Japan's government revised down its economic growth forecasts.

On Monday, U.S. President Donald Trump and his top trade adviser stepped up their criticism of the central bank's monetary tightening, raising investor anxiety.

Benchmark 10-year notes last rose 6/32 in price to yield 2.8354 percent, from 2.857 percent late on Monday.

Oil prices dropped 4 percent, weakening for a third consecutive session as reports of swelling inventories and forecasts of record U.S. and Russian output.

The dollar extended its falls against major currencies ahead of the Fed meeting. The dollar index, tracking it against six major peers, fell 0.09 percent, with the euro up 0.14 percent to $1.1362.

"This year has been quite remarkable in the sense that pretty much all asset classes have been down, which is even worse than 2008 because during the (global financial crisis) we at least saw some safe havens - U.S. government bonds, gold - performing positively," said Stefan Keller, asset allocation strategist at Candriam in Luxembourg.

"At least in real terms, that's not the case today. This is indeed a huge challenge. Clearly it's in sharp contrast to last year's optimistic outlook."

(Reporting by David Randall; Editing by Bernadette Baum)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Police officer hailed for steering Capitol mob from Senate chamber
World

Police officer hailed for steering Capitol mob from Senate chamber

By Tom Hals (Reuters) - A police officer is being hailed for his role steering an angry mob away from the Senate chambers in Wednesday's deadly storming of the U.S. Capitol by supporters of President Donald Trump

At least 25 domestic terrorism cases opened as result of assault on Capitol -lawmaker
World

At least 25 domestic terrorism cases opened as result of assault on Capitol -lawmaker

WASHINGTON (Reuters) - At least 25 domestic terrorism cases have been opened as a result of Wednesday's assault on the Capitol by supporters of President Donald Trump, U.S. Army Secretary Ryan McCarthy told a Democratic lawmaker on Sunday

Indonesia locates black boxes of crashed jet as body parts recovered
World

Indonesia locates black boxes of crashed jet as body parts recovered

By Fransiska Nangoy and Bernadette Christina JAKARTA (Reuters) - Indonesian authorities on Sunday located the black boxes of the Sriwijaya Air jet that crashed into the sea soon after taking off from the capital Jakarta, as human body parts and pieces of the plane were retrieved. The Boeing 737-500 with 62 passengers and crew was headed on a domestic flight to Pontianak in West Kalimantan on Saturday before it disappeared from radar screens four minutes after take-off