Markets struggle before rate decisions

Published: 09:10 PM, 30 Jan, 2023
Markets struggle before rate decisions
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Stock markets wavered on Monday as central banks will lift interest rates again later this week in their battle against high inflation.

Wall Street opened in the red while Paris and Frankfurt were down in afternoon deals.

London was up 0.1 percent while Shanghai and Tokyo finished higher as mainland Chinese markets reopened from holidays.

The US Federal Reserve is forecast Wednesday to lift interest rates by just 25 basis points, down from a half-point hike last month, which followed four straight 75-point increases.

The Bank of England and the European Central Bank will then unveil their latest decisions one day later, with more hikes on the radar.

"Stocks were on the back foot ... as attention shifts to this week's vital Federal Reserve meeting, as well as supporting acts in the shape of ECB and BoE," said analyst Neil Wilson.

The central bank meetings come as a string of recent data suggests that last year's monetary tightening campaign by policymakers is beginning to kick in, with price rises beginning to slow from their multi-decade highs.

But there remains trepidation on trading floors that economies could still slip into recession, while a mixed earnings season so far has also caused concern about company profits.

Official data showed that the economies of Germany and Sweden unexpectedly shrank in the last quarter of 2022.

In London on Monday, shares in gambling firm 888 tanked by almost 27 percent after chief executive Itai Pazner resigned amid news of a probe into Middle East operations.

The company added in a statement that it has suspended VIP activities in the region pending the outcome of its internal investigation.

"Gambling stocks are under enough regulatory scrutiny as it is without inviting reasons for further attention and yet that's exactly what 888 has done," said AJ Bell investment director Russ Mould.

"News it is suspending VIP accounts in the Middle East over best practices not being followed over money laundering is incredibly damaging," Mould said.

"Combine that with the announcement of CEO Itai Pazner's immediate departure and the market is likely to draw its own conclusions," he added.

Key figures around 1445 GMT

New York - Dow: DOWN 0.2 percent at 33,926.77 points

London - FTSE 100: UP 0.1 percent at 7,772.51

Frankfurt - DAX: DOWN 0.2 percent at 15,114.20

Paris - CAC 40: DOWN 0.2 percent at 7,083.05

EURO STOXX 50: DOWN 0.6 percent at 4,153.09

Tokyo - Nikkei 225: UP 0.2 percent at 27,433.40 (close)

Hong Kong - Hang Seng Index: DOWN 2.7 percent at 22,069.73 (close)

Shanghai - Composite: UP 0.1 percent at 3,269.32 (close)

Euro/dollar: UP at $1.0896 from $1.0868 on Friday

Pound/dollar: DOWN at $1.2381 from $1.2382

Euro/pound: UP at 88.00 pence from 87.77 pence

Dollar/yen: UP at 130.28 yen from 129.88 yen

Brent North Sea crude: DOWN 1.3 percent at $85.31 per barrel

West Texas Intermediate: DOWN 1.3 percent at $78.61 per barrel

Categories : Business

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