Elaine Kurtenbach And Matt Ott, The Associated Press
26 minutes ago
FILE – An entrance to the New York Stock Exchange in New York, June 26, 2024. Stocks fell in most markets around the world Thursday, June 27, 2024, ahead of a key U.S. inflation report due on Friday. (AP Photo/Peter Morgan, File)
Wall Street signaled a pullback in stocks early Thursday ahead of U.S. inflation data due this week that could determine the direction of interest rates.
Futures for the S&P 500 and Dow Jones Industrial Average were both down 0.2% before the market opened.
The main focus for markets this week will be the U.S. government’s inflation report on Friday. The personal consumption expenditures (PCE) index is the Federal Reserve’s preferred inflation gauge, and analysts said recent mixed data has investors on the sidelines.
The latest information on inflation could influence central banks’ decisions on when to start cutting interest rates, which are at their highest in more than two decades and have repercussions around the world.
Investors are hoping the Federal Reserve will start cutting interest rates soon, but efforts to bring inflation back to its 2% target have been stumping, with Wall Street expecting a rate cut when the central bank meets in September.
The economy has held up relatively well despite high inflation and borrowing costs for consumers and businesses, but it is slowing, and Wall Street is hoping the Fed will time its rate cuts to ease pressures before the economy slows too much, but not to miss its goal of keeping inflation in check.
On the market, Boeing shares were slightly down after the company was reprimanded by U.S. investigators for leaking information about a federal investigation into a ruptured door plug that created a large hole in a Boeing 737 Max 9 plane.
Shares of jeans maker Levi Strauss & Co. fell 15.4% in pre-market trading on Thursday after the company reported second-quarter sales that fell short of analyst expectations.
Walgreens shares fell 15.7% after the company cut the top end of its profit forecast, citing “continued pressures on the U.S. consumer.”
Chipmaker Micron fell 5.5% after its latest outlook disappointed investors.
In Europe, at midday, the CAC 40 index in Paris was down 0.5%, while the FTSE 100 in London was down 0.3%. Germany’s DAX index was the only exception, rising 0.2%.
In Asia, a new set of measures to revitalize China’s property market failed to boost sentiment. Hong Kong’s Hang Seng Index fell 2.1% to 17,716.47, while the Shanghai Composite Index fell 0.9% to 2,945.85.
Beijing became the latest city to cut minimum down payment requirements and mortgage interest rates starting Thursday to support the real estate sector.
Other Chinese cities are taking similar steps in line with national policies aimed at luring buyers back to a market that has slumped since the government cracked down on excessive borrowing by property developers, causing dozens of property companies to default on loans and dragging down the wider economy of the world’s second-largest economy.
In Tokyo, the Nikkei average fell 0.8 percent to 39,341.54 on concerns the yen would continue to weaken.
The U.S. dollar was trading at 160.53 yen early Thursday after breaking through the 160 yen level the previous day, its lowest since late 1986. Japanese government officials have warned they may intervene in the market to counter the trend, which has both positive and negative effects on the economy.
Elsewhere in Asia, Australia’s S&P/ASX 200 fell 0.3 percent to 7,759.60. Taiwan’s Taiex lost 0.4 percent and Bangkok’s SET lost 0.5 percent. Shares in Mumbai, Jakarta and Singapore rose.
Benchmark U.S. crude rose 34 cents to $81.24 a barrel in electronic trading on the New York Mercantile Exchange, while the international standard, Brent crude, added 32 cents to $84.79 a barrel.
The euro rose to $1.0699 from $1.0681.
In mostly sluggish trading on Wednesday, Wall Street stock indexes were near the all-time highs they hit last week. The S&P 500 index rose 0.2%, but about 65% of the stocks that make up the index were down.
The Dow Jones Industrial Average finished up less than 0.1%, while the Nasdaq Composite Index rose 0.5%.
