Global stocks mostly retreated Wednesday after British inflation data doused hopes of a quick Bank of England rate cut, while Federal Reserve minutes spotlighted worries about lingering pricing pressure.
London stocks closed lower and the pound jumped on news that Britain’s Consumer Prices Index rose 2.3 percent in April, slower than the previous month but outpacing analyst expectations of 2.1 percent.
“This was disappointing news, and the markets moved quickly to price out hopes of a June rate cut. It now looks as if September is most likely,” said David Morrison, senior analyst at Trade Nation.
US stocks traded sideways much of the day following a down session on leading Asian and European bourses.
But US indices tripped into the red after the Fed minutes showed that policy makers were frustrated with the lack of progress in bringing inflation towards the central bank’s two percent target.
The disappointing inflation data, and the strong economic figures in the first quarter, led them to conclude that “it would take longer than previously anticipated” for them to be confident that inflation was trailing off, the Fed said.
Briefing.com analyst Patrick O’Hare said the concerns were unsurprising given the mindset of the Fed at the May 1 meeting, but that the release served as an excuse for investors to sell after a big rally since the meeting.
All three major US indices ended lower, including the Nasdaq, which lost 0.2 percent, pulling back after two records.
Anticipation was high heading into the day owing to results from artificial intelligence highflier Nvidia.
The chip-maker’s stock price is up 90 percent in 2024 with its high-end processors prized by firms looking to get ahead in the booming artificial intelligence sector.
Nvidia reported a profit of $14.9 billion on revenue of $26 billion in the recently ended quarter, both multiples of what it made in the same period a year earlier.
Shares climbed 3.5 percent in after-hours trading.
Elsewhere, food-to-clothing retailer Marks & Spencer rose 3.7 percent on a strong profits report, but that was not enough to pull London’s overall FTSE 100 Index higher.
Anglo American rose 0.4 percent after the London-quoted company rejected the latest bid by BHP but left the door open to further discussions.
Target slumped 8.0 percent after reporting a drop of 3.7 percent in comparable sales in the first quarter. The big-box retailer characterized the results as being in line with expectations.
Moderna surged 13.7 percent after announcing that it had been cleared to present abstracts at the 2024 American Society of Clinical Oncology annual meeting, which begins on May 31 in Chicago.
Copper prices slumped for a second day as traders took profits on a rally that had taken it above $11,000 a ton.
– Key figures around 2040 GMT –
New York – Dow: DOWN 0.5 percent at 39,671.04 (close)
New York – S&P 500: DOWN 0.3 percent at 5,307.01 (close)
New York – Nasdaq Composite: DOWN 0.2 percent at 16,801.54 (close)
London – FTSE 100: DOWN 0.6 percent at 8,370.33 points (close)
Paris – CAC 40: DOWN 0.6 percent at 8,092.11 (close)
Frankfurt – DAX: DOWN 0.3 percent at 18,680.20 (close)
EURO STOXX 50: DOWN 0.4 percent at 5,025.17 (close)
Tokyo – Nikkei 225: DOWN 0.9 percent at 38,617.10 (close)
Hong Kong – Hang Seng Index: DOWN 0.1 percent at 19,195.60 (close)
Shanghai – Composite: FLAT at 3,158.54 (close)
Dollar/yen: UP at 156.75 yen from 156.17 yen on Tuesday
Euro/dollar: DOWN at $1.0826 from $1.0854
Pound/dollar: UP at $1.2717 from $1.2709
Euro/pound: DOWN at 85.10 from 85.40 pence
West Texas Intermediate: DOWN 1.4 percent at $77.57 per barrel
Brent North Sea Crude: DOWN 1.2 percent at $81.90 per barrel
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