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European and Wall Street stock markets were largely flat Monday after some losses in Asia, as investors awaited earnings from US tech behemoths this week. online news
Bourses in New York, London, Frankfurt and Paris dipped in and out of negative territory throughout the day.
All eyes will be on results from the likes of Amazon, Facebook owner Meta, Google-parent Alphabet and Microsoft.
The companies’ health and outlook reports could give clues regarding the Federal Reserve’s next move regarding interest rates.
“The first quarter earnings reporting period will go into hyperdrive this week, which is partly why things are starting today at a slow pace,” said Briefing.com analyst Patrick O’Hare.
There is uncertainty on when the Fed will end its campaign of raising rates, let alone when it could begin to cut borrowing costs.
Inflation remains elevated, but there is an expectation the US and other economies could avoid falling into recession this year.
A survey Monday revealed that business confidence in Germany, Europe’s biggest economy, edged up in April.
At the same time, analysts warned that optimism about falling energy prices and China’s reopening was being offset by worries about higher interest rates.
Stephen Innes of SPI Asset Management noted that China’s rebound following the end of its growth-sapping zero-Covid policies was likely to cool, relying now on higher income growth and improved consumer sentiment.
“So the easy part is done; now, the consumer will need to do the bulk of the heavy lifting,” he said.
Credit Suise woes
Earlier advances in markets slowed during the day as anxious investors waited for news.
“With such an action-packed week investors are best described as ‘skittish’, fretting that data will prompt a reversal in markets but at the same time hoping for just enough good news to give stocks a reason to move out of their recent narrow range,” said Chris Beauchamp, chief market analyst at online trading platform IG.
One of the first to report this week was drinks giant Coca-Cola, which recorded higher quarterly profits but activity still below pre-pandemic levels.
“There’s plenty of uncertainty out there in terms of the direction of inflation, both of the consumers reaction to it, and the input side,” said Chief Executive James Quincey.
Also this week, investors will be watching important economic data from South Korea, Australia and the eurozone, as well as Bank of Japan chief Kazuo Ueda’s approach as he chairs his first key policy meeting.
In parliament on Monday, Ueda suggested the bank would stay the course in terms of monetary stimulus, adding that inflation was expected to cool below two percent in the second half of the fiscal year ending next March.
Elsewhere on the corporate front, Credit Suisse revealed that more than $68 billion was withdrawn in the first three months of 2023, in what are likely its final quarterly results before it is swallowed by rival UBS.
The bank saw its net profit swell to $13.9 billion — up from a significant loss a year earlier — after holders of high-risk Credit Suisse debt were wiped out in the emergency takeover deal.
The problems at Credit Suisse will continue to prompt fallout across the banking sector, said Michael Hewson, chief market analyst at CMC Markets UK.
“It’s set to be a big week for the UK banking sector in the wake of the problems thrown up by the collapse of Credit Suisse and subsequent turmoil across the sector,” he said.
“This morning investors got the first look below the bonnet so to speak and it wasn’t a pretty sight…. not so much a bank run as a sprint.”
Keys figures around 1545 GMT
New York – Dow: FLAT at 33,804.40
EURO STOXX 50: DOWN 0.2 percent at 4,400.35
London – FTSE 100: FLAT at 7,912.20 points (close)
Frankfurt – DOWN 0.1 percent at 15,863.95 (close)
Paris – CAC 40: FLAT at 7,573.86 (close)
Tokyo – Nikkei 225: UP 0.1 percent at 28,593.52 (close)
Hong Kong – Hang Seng Index: DOWN 0.6 percent at 19,959.94 (close)
Shanghai – Composite: DOWN 0.8 percent at 3,275.41 (close)
Euro/dollar: UP at $1.1025 from $1.0993 on Friday
Pound/dollar: UP at $1.2457 from $1.2446
Dollar/yen: UP at 134.40 yen from 134.09 yen
Euro/pound: UP at 88.50 pence from 88.30 pence
West Texas Intermediate: UP 0.8 percent at $78.67 per barrel
Brent North Sea crude: UP 1.0 percent at $82.37 per barrel
burs-rox/bp
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