By IFCMarkets
US stock indexes retreat deepened on Wednesday as the Federal Reserve cut interest rates quarter point but indicated this was not “the beginning of a long series of rate cuts.” The S&P 500 fell 1.1% to 2980. The Dow Jones industrial average lost 1.2% to 26864. Nasdaq composite index tumbled 1.2% to 8175. The dollar strengthening accelerated despite Fed statement it would stop reducing its $3.6 trillion in bond holdings starting August 1, two months ahead of schedule. The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, jumped 0.6% to 98.59 and is higher currently. Stock index futures point to mixed market openings today
European stocks paused their retreat on Wednesday ahead of US Federal Reserve interest rate decision. EUR/USD joined GBP/USD’s continued slide yesterday with both pairs falling currently. The Stoxx Europe 600 edged up 0.2%. Germany’s DAX 30 rose 0.3% to 12189.04. France’s CAC 40 inched up 0.1% but UK’s FTSE 100 slid 0.8% to 7586.78.
Asian stock indices retreat slowed today as US-China trade negotiations concluded in Shanghai with no major breakthrough with talks expected to continue in Washington in September. However China did agree to buy more US agricultural products. Nikkei however managed to end 0.1% higher at 21540.99 with yen accelerating its slide against the dollar. Chinese stocks are falling despite Caixin report China’s manufacturing improved in June: the Shanghai Composite Index is down 0.8% and Hong Kong’s Hang Seng Index is 0.6% lower. Australia’s All Ordinaries Index extended its losses 0.4% as Australian dollar climb against the greenback resumed.
Brent futures prices are inching higher today. Prices rose yesterday after the Energy Information Administration report US crude inventories dropped by above expected 8.5 million barrels last week while gasoline inventories fell by 1.8 million. October Brent crude rose 0.7% to $65.05 a barrel on Wednesday.
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