World shares flattened by stubborn inflation and slow China growth
By Nell Mackenzie
LONDON (Reuters) -World shares struggled to climb on Monday after the chances of early interest rate cuts globally receded and Chinese markets recorded modest gains on their return from the lunar new year break.
A holiday for U.S. markets made for thin trading, and results from AI star Nvidia (NASDAQ:NVDA) on Wednesday could challenge the latest surge in tech stocks.
MSCI's broadest index of world shares and Europe's broader index of stocks both traded around 0.05% as of 13:53 GMT.
«The mixed economic data released lately has put us in a transition period and we are waiting for the data to tell a consistent story,» James Rossiter, head of global macro strategy at TD Securities, said.
A red-hot U.S. CPI print on Tuesday followed by another upside surprise in producer prices on Friday left investors anxious inflation will persist. A weaker retail sales report, suggesting slower economic momentum augmented their concerns.
However, U.S. labour market numbers have continued to show plentiful jobs and elevated wage growth.
In Asia, Japan's Nikkei ended flat on Monday, pressured by chip-related shares following a slump in their U.S. counterparts late last week. (T)
Chinese blue chips finished up just over 1%, after tourism revenues during the Lunar New Year holiday surged by 47% compared with a year earlier as more than 61 million rail trips were taken.
The country's central bank skipped another chance to cut rates on Sunday, limiting downward pressure on the yuan, but as deflation looms, analysts see scope for further policy stimulus.
The same cannot be said for the United States as high readings on producer and consumer prices led markets to scale back pricing for rate cuts.
«The risk to the rally is a
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