How Stocks pause as faltering China knocks oil and copper

Weaker U.S. stock index futures also sapped momentum on European bourses, with global shares pausing after four weeks of gains helped by hopes that peaking U.S. inflation will persuade the Federal Reserve to dial back on a hefty interest rate rise next month

Weaker U.S. stock index futures also sapped momentum on European bourses, with global shares pausing after four weeks of gains helped by hopes that peaking U.S. inflation will persuade the Federal Reserve to dial back on a hefty interest rate rise next month.

Gold slid but China's woes lifted the dollar.

S&P 500 futures and Nasdaq futures were down about 0.4% ahead of Wall Street's opening bell, with earnings from major retailers, including Walmart (WMT.N) and Target (TGT.N), set to be scrutinised for any signs of flagging U.S. consumer demand.

The MSCI all-country index (.MIWD00000PUS) was little changed, halting a month-long advance which has helped reduce the benchmark's decline for the year to about 13%.

China's central bank unexpectedly cut key lending rates to revive demand as data showed the economy unexpectedly slowing in July, with factory and retail activity squeezed by Beijing's zero-COVID policy and a property crisis. read more

"China, I think, is a different situation than the rest of the world. They've got a self-imposed recession that they've created from the zero COVID policy," said Patrick Armstrong, chief investment officer at investment house Plurimi Group.

"I do think it's going to be Fed driven if there is another leg down in markets. Quantitative tightening, I think, will begin in earnest in September and that's going to withdraw liquidity from the market," Armstrong said.

Markets are roughly split over whether the Fed will hike by 50 basis points or 75 basis points in September.

The Fed will publish minutes on Wednesday from its last rate-setting meeting, but investor hopes of them showing the central bank beginning to pivot on rate hikes could be dashed.

"I don't think (Fed Chair) Powell is going to say that, I don't think the minutes are going to indicate that," Armstrong said.

In Europe, the STOXX share index (.STOXX) of 600 leading companies was up 0.14% at 441.49 points, still down around 10% from a record high in January.Weaker U.S. stock index futures also sapped momentum on European bourses, with global shares pausing after four weeks of gains helped by hopes that peaking U.S. inflation will persuade the Federal Reserve to dial back on a hefty interest rate rise next month.

Gold slid but China's woes lifted the dollar.

S&P 500 futures and Nasdaq futures were down about 0.4% ahead of Wall Street's opening bell, with earnings from major retailers, including Walmart (WMT.N) and Target (TGT.N), set to be scrutinised for any signs of flagging U.S. consumer demand.

The MSCI all-country index (.MIWD00000PUS) was little changed, halting a month-long advance which has helped reduce the benchmark's decline for the year to about 13%.

China's central bank unexpectedly cut key lending rates to revive demand as data showed the economy unexpectedly slowing in July, with factory and retail activity squeezed by Beijing's zero-COVID policy and a property crisis. read more

"China, I think, is a different situation than the rest of the world. They've got a self-imposed recession that they've created from the zero COVID policy," said Patrick Armstrong, chief investment officer at investment house Plurimi Group.

"I do think it's going to be Fed driven if there is another leg down in markets. Quantitative tightening, I think, will begin in earnest in September and that's going to withdraw liquidity from the market," Armstrong said.

Markets are roughly split over whether the Fed will hike by 50 basis points or 75 basis points in September.

The Fed will publish minutes on Wednesday from its last rate-setting meeting, but investor hopes of them showing the central bank beginning to pivot on rate hikes could be dashed.

"I don't think (Fed Chair) Powell is going to say that, I don't think the minutes are going to indicate that," Armstrong said.

In Europe, the STOXX share index (.STOXX) of 600 leading companies was up 0.14% at 441.49 points, still down around 10% from a record high in January.Weaker U.S. stock index futures also sapped momentum on European bourses, with global shares pausing after four weeks of gains helped by hopes that peaking U.S. inflation will persuade the Federal Reserve to dial back on a hefty interest rate rise next month.

Gold slid but China's woes lifted the dollar.

S&P 500 futures and Nasdaq futures were down about 0.4% ahead of Wall Street's opening bell, with earnings from major retailers, including Walmart (WMT.N) and Target (TGT.N), set to be scrutinised for any signs of flagging U.S. consumer demand.

The MSCI all-country index (.MIWD00000PUS) was little changed, halting a month-long advance which has helped reduce the benchmark's decline for the year to about 13%.

China's central bank unexpectedly cut key lending rates to revive demand as data showed the economy unexpectedly slowing in July, with factory and retail activity squeezed by Beijing's zero-COVID policy and a property crisis. read more

"China, I think, is a different situation than the rest of the world. They've got a self-imposed recession that they've created from the zero COVID policy," said Patrick Armstrong, chief investment officer at investment house Plurimi Group.

"I do think it's going to be Fed driven if there is another leg down in markets. Quantitative tightening, I think, will begin in earnest in September and that's going to withdraw liquidity from the market," Armstrong said.

Markets are roughly split over whether the Fed will hike by 50 basis points or 75 basis points in September.

The Fed will publish minutes on Wednesday from its last rate-setting meeting, but investor hopes of them showing the central bank beginning to pivot on rate hikes could be dashed.

"I don't think (Fed Chair) Powell is going to say that, I don't think the minutes are going to indicate that," Armstrong said.

In Europe, the STOXX share index (.STOXX) of 600 leading companies was up 0.14% at 441.49 points, still down around 10% from a record high in January.I do think it's going to be Fed driven if there is another leg down in markets. Quantitative tightening, I think, will begin in earnest in September and that's going to withdraw liquidity from the market," Armstrong said.

Markets are roughly split over whether the Fed will hike by 50 basis points or 75 basis points in September.

The Fed will publish minutes on Wednesday from its last rate-setting meeting, but investor hopes of them showing the central bank beginning to pivot on rate hikes could be dashed.

"I don't think (Fed Chair) Powell is going to say that, I don't think the minutes are going to indicate that," Armstrong said.

In Europe, the STOXX share index (.STOXX) of 600 leading companies was up 0.14% at 441.49 points, still down around 10% from a record high in January.I do think it's going to be Fed driven if there is another leg down in markets. Quantitative tightening, I think, will begin in earnest in September and that's going to withdraw liquidity from the market," Armstrong said.

Markets are roughly split over whether the Fed will hike by 50 basis points or 75 basis points in September.

The Fed will publish minutes on Wednesday from its last rate-setting meeting, but investor hopes of them showing the central bank beginning to pivot on rate hikes could be dashed.

"I don't think (Fed Chair) Powell is going to say that, I don't think the minutes are going to indicate that," Armstrong said.

In Europe, the STOXX share index (.STOXX) of 600 leading companies was up 0.14% at 441.49 points, still down around 10% from a record high in January.