Volatility in stock markets continues to ebb in anticipation of fresh economic data
US stocks saw the most volatile week of 2024. After a severe plunge, major indexes rebounded to reverse most of their weekly losses eventually. The S&P 500 was less than 0.1% lower for the week, while the Nasdaq Composite and the Dow Jones shed 0.18% and 0.6%, respectively. On Monday, US stock index futures were nearly flat as investors shifted focus to key inflation data due later in the week. Also, market participants will closely monitor updates on retail sales and unemployment. The data could provide the Fed more room to cut interest rates.
In Asia, equities were mixed-to-higher on Monday as volatility continued to ebb after the recent spike. Australia’s S&P/ASX 200 rose 0.46%, Hong Kong’s Hang Seng edged 0.13% higher and the Shanghai Composite index slipped 0.14%. The South Korean Kospi jumped 1.14% amid a rally in in Samsung Electronics shares. Markets in Tokyo were closed for a holiday. Japan’s Nikkei 225 was down 2.5% last week.
European markets opened higher on Monday, extending gains for the fifth session in a row. The Stoxx Europe 600 Index rose 0.4% in early deals, but is still down more than 3% for the month. On the data front, the latest reading for Germany’s ZEW expectations index and UK inflation will be in focus this week. In individual stocks, Hannover Rueck SE shares added more than 6% at the open in a reaction to stronger-than-expected earnings. After the initial rally, stocks trimmed some gains, however.
Meanwhile, the US dollar looks steady and directionless at the start of the week. The USD index has settled above the 103.00 figure that represents the immediate support at this stage. The upcoming economic data out of the United States will set fresh direction to the greenback in the days to come. Should inflation for July come in lower than in the previous month, Fed rate cut expectations will strengthen further, which would be dollar-negative. In a wider picture, the US currency keeps losing ground since late-June, continuing to retreat from the 106.00 figure.
