Markets prep for big week of rates, data
Stocks fell as traders took risk off the table ahead of a raft of policy decisions this week from the US, the UK and Japan.
Societe Generale SA slumped as much as 7.6% and was among the biggest drags on Europe’s Stoxx 600 Index after the Paris-based lender’s strategic plan included cuts to revenue and profitability targets. US equity futures signaled a slight rebound from Friday’s declines on Wall Street.
Brent crude oil pushed toward $95 a barrel, highlighting inflationary pressures just as policymakers at key central banks prepare for their interest-rate meetings. The Federal Reserve’s announcement on Wednesday will be followed by those from the Bank of England on Thursday and the Bank of Japan a day later.
US Treasury yields ticked higher, with the policy-sensitive two-year rate above 5%.
Monday’s subdued mood in stock markets matched the tone of a note from Morgan Stanley strategists, who said investors have turned more cautious. The team led by Michael Wilson said there’s a growing debate among clients about whether a recession has been avoided or just delayed.
“The majority of investors we’ve spoken with are in the ‘pushed out’ camp and are of the view that 2024 is now looking like a more challenging year for risk assets relative to 2023,” Wilson wrote in a note.
On the outlook for oil, traders will be monitoring clues on prospects for global supply when Saudi Energy Minister Prince Abdulaziz bin Salman addresses an industry conference later Monday. Hedge funds last week boosted their bullish wagers on Brent and US crude to a 15-month high.
Among currencies, the dollar weakened against most of its G-10 peers.
Fed Outlook
US inflation expectations fell to the lowest in more than two years as consumers grew
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