Global stocks fell on Thursday as U.S. Treasury yields remained near 5%, U.S. economic growth exceeded expectations, and companies reported mixed results. results.
* The US economy grew at its fastest pace in nearly two years in the third quarter, data showed, as rising wages in a tight labor market helped boost consumer spending, once again defying expectations. Economic warnings that continue until 2022
* The unexpected strength of the US economy has influenced the elimination of the fixed-income market. The yield on the benchmark 10-year note fell slightly to 4.913% after touching 4.989%, the highest level since 2007, touched earlier in the week, near 5.021%.
Quincy Krosby, chief global strategist at LPL Financial in Charlotte, said U.S. economic growth has raised market concerns that the Federal Reserve will need to raise interest rates again before the end of the year to extinguish inflation.
* “The Fed’s work is not done, and it does not appear that higher interest rates are doing the job for them,” Krosby said in an email.
* Traders also await Friday’s release of the personal consumption price index (PCE), the Fed’s preferred inflation indicator.
* On Wall Street, the Dow Jones Industrial Average fell 0.15%, to 32,986 units; the S&P 500 index fell 0.5%, to 4,164 units; and the Nasdaq Composite fell 1%, to 12,690.99 units.
* Meta Platforms fell 3.8% on weaker prospects, while mega-cap stocks like Tesla and Microsoft fell 1.2% and 2.7%, respectively, dragged by higher rates.
* These declines came after Alphabet’s shares posted their worst session since March 2020, falling 9.5%, as investors were disappointed by the growth of the cloud division. Amazon.com will present its results after the close of business.
* The European Central Bank snapped the longest streak of rate hikes in its 25-year history on Thursday, leaving the key rate at a record high of 4% and saying the latest data still pointed to inflation slowly approaching the target of 2%.
* The market reaction to the decision is limited. The euro fell 0.25% and the pan-European STOXX 600 index lost 0.5%, near the seven-month low hit earlier in the week.
* MSCI’s broadest index of Asia-Pacific shares outside Japan hit its lowest level in 11 months, down 1.15%.
* In currency markets, the dollar index traded at a two-week high of 106.7, boosted by rising yields, and the yen weakened beyond 150 per dollar, a level that put traders on guard against the possibility of intervention to support the Japanese. money
* In raw materials, the price of crude oil fell by about 1.5% due to the increase in inventories in the United States and the strength of the dollar, although the war in the Middle East is still on the minds of those operators. Spot gold is trading steady at around $1,979 an ounce.