European stock markets fell while Wall Street indices were little changed Tuesday as traders awaited more signs on the direction of interest rates and an earnings update from US tech giant Nvidia.
In some markets, profit-takers appear to have stepped in to take advantage of strong gains in recent sessions.
“It looks as if investors are choosing to take some money off the table now,” said David Morrison, senior analyst at Trade Nation.
“There was little to influence market direction following all the excitement from last week’s ever-so-slightly positive, although just-as-expected” US consumer inflation data, he said.
Stock markets hit fresh record highs last week after figures showed US inflation slowed to 3.4 percent in April, raising hopes that the Federal Reserve will cut interest rates in the coming months.
But all major European markets were lower on Tuesday, while in New York the Dow and the broader S&P 500 were basically unchanged while the Nasdaq was down slightly.
“One can see that there isn’t a lot of conviction” in the market, said Patrick O’Hare, an analyst at Briefing.com. There’s an “expectation of consolidation activity given the run the major indices have enjoyed since their mid-April lows.”
Eyes are on the release later in the day of minutes from the Federal Reserve’s May policy decision for clues on the outlook for cuts to US interest rates.
Recent US data has been mixed and a number of Fed decision-makers have warned they are not willing to call for a reduction until they are convinced higher borrowing costs are doing their job and that inflation is truly under control.
Wall Street shares are also being held back by JPMorgan Chase CEO Jamie Dimon’s announcement Monday that the bank is not expecting to buy back a lot of stock, O’Hare said.
On Wednesday, investors will closely watch earnings results from US chip-maker and stock market star Nvidia, whose high-end processors are key for artificial intelligence companies.
“For the market to keep momentum this week, it may come down to just one stock — Nvidia,” Freedom Capital Markets’ Jay Woods said. “It sure feels like the hype for this earnings event will be the talk of trading desks and financial media all week.”
Chinese property firms, which soared Friday on news of new government support measures, sank in Hong Kong, which led other Asian markets lower.
China’s announcement Tuesday that local governments took in the least amount of revenue for land sales in eight years underscored the difficult path to bring China’s property sector back to health.
Copper, a key gauge of the state of the economy owing to its widespread use, hit a record above $11,400 Monday, while gold fell back marginally from its own peak touched on the same day. Silver was around an 11-year high.
Oil prices fell and the dollar was little changed.
– Key figures around 1340 GMT –
New York – Dow: FLAT at 39,806.18
New York – S&P 500: DOWN 0.1 percent at 5,303.13
New York – Nasdaq Composite: DOWN 0.3 percent at 16,752.78
London – FTSE 100: DOWN 0.3 percent at 8,400.95 points
Paris – CAC 40: DOWN 0.9 percent at 8,120.37
Frankfurt – DAX: DOWN 0.5 percent at 18,684.51
EURO STOXX 50: DOWN 0.7 percent at 5,036.81
Tokyo – Nikkei 225: DOWN 0.3 percent at 38,946.93 (close)
Hong Kong – Hang Seng Index: DOWN 2.1 percent at 19,220.62 (close)
Shanghai – Composite: DOWN 0.4 percent at 3,157.97 (close)
Dollar/yen: DOWN at 156.16 yen from 156.29 yen on Friday
Euro/dollar: DOWN at $1.0856 from $1.0861
Pound/dollar: UP at $1.2712 from $1.2707
Euro/pound: DOWN at 85.43 from 85.46 pence
West Texas Intermediate: DOWN 1.4 percent at $78.70 per barrel
Brent North Sea Crude: DOWN 1.3 percent at $82.59 per barrel
gv/lth
