Key global stock markets fell yesterday as investors lowered bets that policies of US President Donald Trump would benefit economic growth, and instead favoured assets considered safer such as bonds and gold.
Oil futures fell, pressuring energy stocks after data showed US crude inventories rose for a seventh week, signalling oversupply despite OPEC’s efforts to rein in output.
The dollar were little changed but set for a weekly decline as the Trump administration’s lack of details on tax cuts and infrastructure spending raised doubts about chances for improved domestic growth and investments in 2017.
“The market will come to realize that a lot of these pro-growth policies might get pushed to the end of this year or next year and you might have this buyer’s remorse for the market,” said Aaron Clark, portfolio manager at GW&K Investment Management.
The MSCI world equity index, which tracks shares in 46 nations, fell 2.49 points or 0.56 per cent, to 444.26. It reached an all-time peak at 447.67 on Thursday.
On Wall Street, the Dow Jones Industrial Average, which tracks blue-chip stocks, was on track to end a 10-day winning streak, the longest since 1987. It was last down 57.54 points, or 0.28 percent, to 20,752.78.
The benchmark S&P 500 lost 7.45 points, or 0.32 per cent, to 2,356.36, below its record high of 2,368.26 set on Thursday.
The Nasdaq Composite declined for a third straight day, which last happened in late December. It was down 23.47 points, or 0.4 percent, at 5,812.04.
Europe’s broad FTSEurofirst 300 index dropped 0.96 per cent at 1,456.05.
Similar to stocks, the greenback was on its back foot. The dollar index was down 0.1 percent at 100.93, on track for a slim weekly loss.
As equities and the dollar lost some of their appeal, bond yields fell with German two-year Schatz yield touching minus 0.953 per cent, Reuters data showed.
Nervousness about the first round of the French presidential election, with anti-European Union Marine Le Pen in the lead, has stoked safehaven demand for German and US government debt.
Bids for less risky assets, together with traders’ remote view of the Federal Reserve raising interest rates in March, bolstered gold prices to their highest in over three months.
Spot gold prices rose $7.17 or 0.57 percent to $1,256.51 an ounce.
In the oil market, Brent crude was last down $0.39, or down 0.69 per cent, at $56.19 a barrel. US crude was last down $0.27, or down 0.5 per cent, at $54.18 per barrel.