Stock rally takes a breather; Chinese inflation data points to slowing growth

Concerns regarding the partial government shutdown in the US soured sentiment ahead of earnings. In addition, inflation data from China indicated slowing growth in the world’s second-largest economy.

Jan 10, 2019 12:01 IST India Infoline News Service

China stock markets down
Global equities declined today as oil posted the first drop in two weeks. S&P 500, Dow Jones, and Nasdaq futures fell following the underlying benchmarks' rise for four consecutive days.

European markets are lower today with shares in France leading the decline. The CAC 40 is down 0.81% while Germany's DAX is off 0.41% and London's FTSE 100 is lower by 0.18%.

Asian markets ended mixed with the Hang Seng up 0.09%, while the Nikkei 225 led the Shanghai Composite lower falling 1.29% and 0.36%, respectively. The MSCI Asia Pacific Index was off marginally.

Concerns regarding the partial government shutdown in the US soured sentiment ahead of earnings. Further, lack of any concrete data from the US-China talks also meant that there was no trigger to rise for the markets. In addition, inflation data from China indicated slowing growth in the world’s second-largest economy.

China’s inflation rose by much less than expected in December. The consumer price index dipped to 1.9%, below the 3% upper limit set by the central bank. Further, producer prices rose at the slowest rate in two years.

Meanwhile, British Prime Minister Theresa May sought options for a Brexit “Plan B.” Treasuries edged higher with a rise in bonds.

West Texas oil fell to ~$52 after rallying through two weeks. Gold rose marginally to $1,294.09 an ounce.

Key events on the investor radar this week:
• Fed Chairman Powell speech at the Economic Club of Washington D.C. today
• Britain’s Parliament’s resumption of a debate on the Brexit withdrawal bill

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