European shares held firm after Asia rose on price expectations By Reuters
Written by Harry Robertson and Rae Wee
LONDON/SINGAPORE (Reuters) – European shares were flat on Tuesday after inflation data came in line with expectations, while Asian shares rose as some investors hoped that US President-elect Donald Trump would use much lower rates than previously thought.
The pan-European index ended up 0.1%, after rising 0.95% on Monday following a news report that Trump might consider lower tariffs, causing shares of automakers to rally. rose 0.2% and the 100 fell 0.2%.
MSCI’s broadest index of Asia-Pacific shares outside Japan rose 0.2%. rose 2%, boosted by a rally in tech stocks. China’s CSI 300 index gained 0.7%.
China’s main stock exchange asked large mutual funds to limit share sales at the start of the year, three sources familiar with the matter said, as authorities sought to calm markets heading into a difficult period in the world’s second-largest economy.
In the United States, it was flat and Nasdaq futures lost 0.1% after the benchmark index rose to more than a one-week high on Monday, helped by technology companies.
The Washington Post reported on Monday that Trump’s aides were examining tax plans that would apply to all countries but include certain sectors deemed important to national security or the economy, in what could represent a significant softening of Trump’s promises made during the 2024 presidential campaign. .
While the news initially sent stocks rallying and the dollar tumbling, Trump’s subsequent denial reversed the decline in the US currency.
“No one really knows what kind of tariffs or trade policies the Trump administration will implement,” said Khoon Goh, head of Asia research at ANZ.
“It is still possible that what the Washington Post is saying is true. His officials and his aides will go through and come up with different methods, but in the end it is up to Trump to decide.”
DISPOSAL OF DATA
Euro zone inflation data on Tuesday showed price growth reached 2.4% year-on-year in December on higher energy costs, up from 2.2% the previous month. The data was consistent with expectations.
The key data release this week will be the US December nonfarm payrolls report on Friday. US job opening data will be available later today, while Wednesday will bring the weekly unemployment figures and the ADP hiring estimate for December.
In financial markets, the 0.3% decline was near a one-week low of 107.97, after falling 0.55% in the previous session as investors counted on reduced prices to help other currencies related to the greenback.
The euro and sterling extended gains from the previous session, each up 0.3% to trade at $1.042 and $1.2558 respectively.
The Canadian dollar strengthened to 1.4305 against the US dollar, extending Monday’s rally after Canadian Prime Minister Justin Trudeau said he would step down in the coming months.
“If Canada can go to an early election with a Conservative-led government, the CAD would appreciate,” said Thierry Wizman, global FX and price strategist at Macquarie.
The minutes of the US Fed’s latest meeting on Wednesday will give color to officials’ rate forecasts, while there will be plenty of comments from several top policymakers.
setting the tone for borrowing costs around the world, it held firm at 4.622%, almost the highest since May.
