Europe skids as China tariffs threat rattles car makers
World stocks index dips after hitting record high
Fed pushes rate cut bets back to Dec but inflation cools
European shares lower as tariffs and politics weighs
Graphic: World FX rates http://tmsnrt.rs/2egbfVh
By Marc Jones
LONDON, June 13 (Reuters) -World stocks retreated from record highs on Thursday as the feelgood factor of slowing U.S. inflation and somewhat comforting Fed signals made way for a fresh bout of politics- and tariffs-induced weakness in Europe.
Bond market borrowing costs and the dollar rose after the Fed nudged back rate cut expectations, but with the moves only partly reversing big falls the previous day, markets had their focus firmly on the dramatic action elsewhere.
That was mainly Europe where the continent-wide STOXX 600 .STOXX was driven 1% lower by a 2.2% slump in its car makers .SXAP as China signalled it would respond to the EU's move to slap tariffs of up to 38.1% on China-made electric vehicles from next month.
A drop in bank stocks as wellnot only pointed to the market's changed outlook on rates but also the uncertainty caused by this week's sharp swing to the right in EU elections and France's decision to call a snap parliamentary election.
The difference, or spread, between French and German bonds DE10FR10=RR was a steady 61 basis points having hit its widest since March 2023 this week. Standalone yields on most sovereign bonds were between 1-3 basis points higher after Wednesday's softer-than-expected U.S. CPI figure that led to their biggest falls since mid-May. GVD/EUR
The Fed shift "could have been big," AXA's Chief Economist Gilles Moec said. "But I think it was drowned out by the U.S. inflation data we had. So the data beat the Fed guidance."
On the EV tariffs, he said that the EU was at least taking a more targetted company-by-company approach rather than the kind of blanket measures seen from the United States.
"And protectionism is something that got quite a bit of traction during the EU elections campaigns," he added.
Japanese shares and the yen had underperformed overnight as the Bank of Japan began a two-day policy meeting that is expected to see it inch towards a modest tightening of its policy stance.
MSCI's index of Asia-Pacific shares outside Japan .MIAPJ0000PUS climbed 0.6% though as Taiwan's tech-heavy stock market .TWII surged 1.8% to a new high buoyed by the U.S. S&P 500 and Nasdaq closing at all-time peaks on Wednesday.
CLOSE CALL
Chinese stocks .CSI300 .SS had been also been dented by the European EV tariffs move, which came less than a month after the U.S. revealed plans to quadruple its duties on Chinese EVs, which are now regarded as some of the best on the market, to 100%.
Brussels said its tariffs would range from 17.4% for BYD 002594.SZ to 38.1% for SAIC 600104.SS, on top of the standard 10% car duty. That takes the highest overall rate to nearly 50%.
There was other geopolitical posturing too. The U.S. had imposed a new ban on Russian stocks trading on Wednesday while Thursday saw G7 leaders back a long-awaited move to funnel $50 billion of frozen Russia central bank reserves money to Ukraine.
Wall Street futures were still pointing to further gains there later though, with the S&P EScv1 expected to open 0.2% higher and the Nasdaq NQc1 0.6% better off with May's producer price index reading and weekly jobless claims data both due for release shortly. .N
"Ultimately, I think markets prefer strong and robust economic growth with no rate cuts than faltering growth with multiple rate cuts," said David Chao, global markets strategist, Invesco Asia Pacific.
"We are in this environment where I don't think it really matters for markets when the first (Fed) rate cut is going to happen - markets can still perform well."
In his post-meeting press conference on Wednesday, Fed Chair Jerome Powell said the rate-path decision was a "close call" for many policymakers, and to some degree a later start to rate reductions this year had been compensated for with an additional cut in 2025.
The closely watched CPI report earlier in the day had showed core U.S. prices growing at their slowest annual pace in over three years last month and analysts also took the view that those figures would not have been ready in time for the Fed's forecasts.
"The Fed has changed its mind multiple times on its expected policy path, so we don't put much weight on its new set of projections," BlackRock Investment Institute head Jean Boivin said.
The U.S. 10-year Treasury yield US10YT=RR, which is the main driver of global borrowing costs, was at 4.31% in Europe, bang in the middle of where it had traded the previous day. Japan's 10-year yields JP10YTN=JBTC fell as much as 3 bps to 0.955% for the first time since mid May.
The Nikkei newspaper reported that the BOJ is likely to debate a reduction in monthly bond purchases at its policy gathering ending on Friday, echoing earlier reports from Reuters and other news outlets.
The yen was a notable underperformer against the dollar overnight. It lost 0.3% to 157.17 per dollar JPY=EBS, erasing Wednesday's 0.3% advance while the euro EUR=EBS was steady at $1.08 after what had been its best day of the year, albeit after three days of politics-driven losses.
In the other closely watched markets, gold XAU= fell 0.5% to $2,310.30 per ounce and oil dipped to $82 a barrel LCOc1 following a bigger-than-expected rise in U.S. stockpiles. Brent crude though is on course for its best week since early April.
Why EU tariffs matter to China EV makers? https://reut.rs/4clf04i
Reporting by Marc Jones; Editing by Angus MacSwan
https://www.reuters.com/markets/ For Reuters Live Markets blog on European and UK stock markets, please click on: LIVE/
Ativos relacionados
Últimas notícias
Isenção de Responsabilidade: As entidades do XM Group proporcionam serviço de apenas-execução e acesso à nossa plataforma online de negociação, permitindo a visualização e/ou uso do conteúdo disponível no website ou através deste, o que não se destina a alterar ou a expandir o supracitado. Tal acesso e uso estão sempre sujeitos a: (i) Termos e Condições; (ii) Avisos de Risco; e (iii) Termos de Responsabilidade. Este, é desta forma, fornecido como informação generalizada. Particularmente, por favor esteja ciente que os conteúdos da nossa plataforma online de negociação não constituem solicitação ou oferta para iniciar qualquer transação nos mercados financeiros. Negociar em qualquer mercado financeiro envolve um nível de risco significativo de perda do capital.
Todo o material publicado na nossa plataforma de negociação online tem apenas objetivos educacionais/informativos e não contém — e não deve ser considerado conter — conselhos e recomendações financeiras, de negociação ou fiscalidade de investimentos, registo de preços de negociação, oferta e solicitação de transação em qualquer instrumento financeiro ou promoção financeira não solicitada direcionadas a si.
Qual conteúdo obtido por uma terceira parte, assim como o conteúdo preparado pela XM, tais como, opiniões, pesquisa, análises, preços, outra informação ou links para websites de terceiras partes contidos neste website são prestados "no estado em que se encontram", como um comentário de mercado generalizado e não constitui conselho de investimento. Na medida em que qualquer conteúdo é construído como pesquisa de investimento, deve considerar e aceitar que este não tem como objetivo e nem foi preparado de acordo com os requisitos legais concebidos para promover a independência da pesquisa de investimento, desta forma, deve ser considerado material de marketing sob as leis e regulações relevantes. Por favor, certifique-se que leu e compreendeu a nossa Notificação sobre Pesquisa de Investimento não-independente e o Aviso de Risco, relativos à informação supracitada, os quais podem ser acedidos aqui.