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Global stocks fall on weak China manufacturing data

Global stocks and US futures fell Wednesday as weak economic data from China dampened traders’ hopes of a swift post-pandemic recovery in the world’s second-largest economy.

The European region-wide Stoxx 600 index fell 0.2%, Germany’s Dax index fell 0.3%, France’s Cac 40 index fell 0.5% and London’s FTSE 100 index was flat.

Markets in the region were led by Asia, with China’s CSI 300 index surpassing 1 percent, despite analysts expecting a gain after the country’s statistics bureau reported contraction in manufacturing activity in May. fell.

“Rather than becoming a powerhouse to offset the slowdown in the US, China’s economic recovery from the pandemic has become more volatile,” said Susannah Streeter, head of money and markets at Hargreaves Lansdowne. Stated.

Hong Kong’s Hang Seng China Enterprises Index fell 2%, with the benchmark falling more than 20% from its recent high in January, entering bear market territory.

Meanwhile, preliminary German data showed annual consumer price inflation slowed to 6.1% in May from 7.2% the previous month, adding to signs that price pressures are easing rapidly across the region. .

Inflation in France fell to a one-year low of 6% in May and was below analyst expectations, boosting hopes that the European Central Bank is nearing the end of its tightening cycle.

Italy is due to release its inflation results later in the day, with Eurozone data coming out on Thursday.

Stocks tracking the Wall Street benchmark S&P 500 and tech-heavy Nasdaq 100 were both down 0.4% before the New York trading opened.

Traders are worried that Congress will be able to pass a deal to raise the U.S. debt ceiling by early June, when government funds run out, following a volatile deal in the previous deal.

The bipartisan bill agreed on Saturday, which would raise the nation’s $31.4 trillion debt ceiling for two years, must first pass both houses of Congress, with traders preparing for a House vote later Wednesday.

Yields on U.S. Treasury bills, which mature next month — roughly the same day the government might run out of money — fell to 5.2% last week, the highest level in at least 20 years. Yields on bonds rise when prices fall.

Pressure on long-term government bonds eased, with yields on policy-sensitive two-year bonds falling 0.05 percentage points to 4.43%. The benchmark 10-year yield fell 0.05 percentage point to 3.65%.

“Most of the risks from the debt ceiling problem are unforeseen and the market appears to be paralyzed until the issue is resolved legally,” said Mike Zigmont, head of research and trading at Harvest Volatility. Stated.

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Global stocks and US futures fell Wednesday as weak economic data from China dampened traders’ hopes of a swift post-pandemic recovery in the world’s second-largest economy.The European region-wide Stoxx 600 index fell 0.2%, Germany’s Dax index fell 0.3%, France’s Cac 40 index fell 0.5% and London’s FTSE 100 index was flat.Markets in the region were led by Asia, with China’s CSI 300 index surpassing 1 percent, despite analysts expecting a gain after the country’s statistics bureau reported contraction in manufacturing activity in May. fell.”Rather than becoming a powerhouse to offset the slowdown in the US, China’s economic recovery from the pandemic has become more volatile,” said Susannah Streeter, head of money and markets at Hargreaves Lansdowne. Stated.Hong Kong’s Hang Seng China Enterprises Index fell 2%, with the benchmark falling more than 20% from its recent high in January, entering bear market territory. Meanwhile, preliminary German data showed annual consumer price inflation slowed to 6.1% in May from 7.2% the previous month, adding to signs that price pressures are easing rapidly across the region. . Inflation in France fell to a one-year low of 6% in May and was below analyst expectations, boosting hopes that the European Central Bank is nearing the end of its tightening cycle.Italy is due to release its inflation results later in the day, with Eurozone data coming out on Thursday.Stocks tracking the Wall Street benchmark S&P 500 and tech-heavy Nasdaq 100 were both down 0.4% before the New York trading opened.Traders are worried that Congress will be able to pass a deal to raise the U.S. debt ceiling by early June, when government funds run out, following a volatile deal in the previous deal.The bipartisan bill agreed on Saturday, which would raise the nation’s $31.4 trillion debt ceiling for two years, must first pass both houses of Congress, with traders preparing for a House vote later Wednesday.Yields on U.S. Treasury bills, which mature next month — roughly the same day the government might run out of money — fell to 5.2% last week, the highest level in at least 20 years. Yields on bonds rise when prices fall.Pressure on long-term government bonds eased, with yields on policy-sensitive two-year bonds falling 0.05 percentage points to 4.43%. The benchmark 10-year yield fell 0.05 percentage point to 3.65%.“Most of the risks from the debt ceiling problem are unforeseen and the market appears to be paralyzed until the issue is resolved legally,” said Mike Zigmont, head of research and trading at Harvest Volatility. Stated.
https://www.ft.com/content/01587255-4425-4dba-9ca0-4de4229e0148 Global stocks fall on weak China manufacturing data

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