Global Markets Dab on US Rate Hike Projection, AI Spending Concern
Global markets sentiment shifted negatively, with US stocks, the FTSE 100 and the Stoxx 50 nosediving as investors rotated capital from risky assets.
US equities fell sharply on Thursday as investors assessed the deteriorating macroeconomic backdrop and renewed doubts over AI spending amid soaring oil prices following Houthi attacks on tankers in the Red Sea.
By market close, the S&P 500 declined 1.21%, the Nasdaq fell 2.15%, and the Dow Jones retreated 0.97%. Across the pond, European equities also traded lower on Thursday as Brent extended gains for a fifth straight session, reinforcing supply concerns and increasing worries of interest rate hikes.
By market close, the FTSE 100 was down 0.73%, and the Stoxx 50 fell 1.69%. In the Asia-Pacific region, the Nikkei 225 bore the brunt of the technology selloff, falling 2.87%, while the Hang Seng declined 1.17% as chip and internet names came under pressure.
The Johannesburg Stock Exchange (JSE) is set for a softer open, First National Bank said, noting that Asian markets and global futures trade lower with a downward bias, following a sharp risk-off move on Wall Street overnight driven by artificial intelligence (AI) spending concerns and a surge in oil prices.
Tencent is trading down 2.7% in Hong Kong, a negative signal for Naspers and Prosus on the local bourse. Over in Australia, the S&P/ASX 300 Metals & Mining Index is down 3.01%, setting a precedent for a soft open for local resource counters.
Gold and platinum are both softer this morning, adding further pressure to gold miners and precious metals counters.
The JSE closed lower, with red screens across the board as investors remain cautious following the CPI print earlier in the week and the South African Reserve Bank’s decision to leave rates unchanged on Thursday.
The All Share Index and Top 40 fell 1.23% and 1.26% to 108 335 points and 100 332 points, respectively. As oil prices continued to climb and precious metals weakened amid inflationary fears, Resources (-1.21%) ended lower as PGM counters came under pressure, with ARM (-8.04%), Northam (-5.23%), Implats (-5.18%) and Valterra (-4.46%) among the session’s largest decliners.
Industrials fell 1.19%, driven by weakness in consumer-facing counters Dis-Chem (-4.1%), Clicks (-4.0%) and Woolworths (-3.9%), reflecting concerns around household spending and a challenging consumer environment. Financials (-1.56%) followed the trend, making it the weakest of the major sectors on the day. #Global Markets Dab on US Rate Hike Projection, AI Spending Concern# Global Markets Tainted by Tensions, Wall Street, European Stocks Ease
