Global equity markets fell for a second straight day yesterday on mostly weak economic data and metals prices slipped on renewed signs of a downturn in global growth.
Lacklustre manufacturing data from around the world sparked the selling, notably Chinese factory activity shrinking for the 14th straight month and British output at three-month lows.
Economic growth in the eurozone will be slow but steady in the second quarter, surveys indicated, underscoring concerns about the vulnerability of the eurozone’s upturn.
Retail sales also fell across the euro zone as a whole in March, adding to the cautionary tone.
The price of copper, often viewed as a key growth barometer, fell due to selling triggered by a stronger dollar and manufacturing surveys from around the world.
Benchmark copper on the London Metal Exchange was last bid down 1.0 per cent at $4,869.00 a tonne. A higher US currency makes dollar-denominated commodities more expensive for non-US firms.
MSCI’s all-country world index of stock performance in 46 countries fell 0.98 per cent, while the pan-European FTSEurofirst 300 index was down 1.2 per cent. On Wall Street stocks fell even as the vast US services sector expanded in April as new orders and employment accelerated, bolstering views that economic growth would rebound after almost stalling in the first quarter.
But other data showing private employers hired the fewest workers in three years in April dimmed the US outlook. The Dow Jones industrial average fell 87.8 points, or 0.49 per cent, to 17,663.11. The S&P 500 slid 13.48 points, or 0.65 per cent, to 2,049.89 and the Nasdaq Composite lost 35.13 points, or 0.74 per cent, to 4,728.10.
US Treasury yields fell to their lowest in two weeks, with the price of the benchmark 10-year Treasury note rising 2/32 to yield 1.7928 per cent.
The dollar index, a basket of six major trading currencies, rose 0.3 per cent to 93.223, and the dollar strengthened against the yen 0.35 per cent to 106.96.
Oil prices pared gains as a bigger-than-expected gain in US crude stocks tempered concerns about reduced production in Canada’s oil sands region due to a wildfire. Brent crude fell 5 cents at $44.92 a barrel, while US crude rose 17 cents to $43.82 a barrel.