On Monday, European and Asian stocks were mainly lower as Wall Street had its worst week since the outbreak began in 2020.
In Paris, London, and Frankfurt, stocks fell, but in Tokyo, they soared. Shanghai had not changed much.
Investors are becoming increasingly concerned about how aggressively the Federal Reserve will respond to rising inflation during its policy meeting this week.
As the economy received a major knock from the epidemic in 2020 and then rebounded over the previous two years, historically low interest rates, termed quantitative easing, or QE, have helped support the broader market.
“With an end to QE and imminent rate hikes likely to be announced, the FOMC (Fed) meeting dominates the macro calendar this week and is likely to keep risk sentiment on the reluctant side,” ING economists Nicholas Mapa and Robert Carnell wrote in a commentary.
The DAX in Germany fell 1.1 percent to 15,431.03 points, while the CAC 40 in Paris fell 1.4 percent to 6,971.19. The FTSE 100 index lost 0.7 percent to 7,447.03 in London.
Some analysts say that the Fed and other central banks should raise rates sooner rather than later to slow the rise in prices. In December, consumer prices in the United States increased by 7 percent over the previous year, the largest increase in nearly four decades.
Because of the constant pressure on consumers’ wallets, rising costs are prompting concerns that they will begin to cut back on their spending. At the same time, outbreaks of the coronavirus’s omicron form threaten to stymie recovery from the crisis.
The Nikkei 225 index in Tokyo rose 0.2 percent to 27,588.37.
Toshiba Corp.’s stock dropped 1.6 percent after the firm announced it was suspending operations at a unit in southern Japan that creates semiconductors for vehicles and machinery following a major earthquake.
The Kospi index in South Korea fell 1.5 percent to 2,792.00 due to strong selling of large technological companies such as Samsung and LG Chemical. SET, Thailand’s stock exchange, fell 0.7 percent.
The Shanghai Composite index rose 0.1 percent to 3,524.11 points.
The S&P 500 index fell 1.9 percent to 4,397.94 on Friday, losing 5.7 percent for the week, its worst weekly loss since March 2020.
The Nasdaq composite index, which is heavily weighted in technology, fell 2.7 percent to 13,768.92. It has been falling for four weeks and is now more than 10 percent below its most recent high, indicating a market correction, according to Wall Street.
Brent crude, the international benchmark for oil prices, rose 26 cents to $88.15 a barrel.
From 113.68 yen, the US dollar dropped to 113.62 yen. The euro fell from $1.1346 to $1.1327.
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