World Economy

Global Stocks Drop

Global Stocks DropGlobal Stocks Drop

World stocks, the dollar and oil all fell modestly on Monday as investors locked in recent gains before central bank meetings in the United States and Japan this week.

European and Asian equities both sank as 3.2 and 1.2% falls for miners and oil firms pushed the FTSEurofirst 300 down for a third straight day and Tokyo gave back a fifth of the 4% it made last week, Reuters reported.

Wall Street ESc1 looked set for a subdued start too with another flurry of company earnings from, among others, Halliburton and Xerox about to hit after some disappointing showings last week.

Signs that a three-month rally in stocks and commodities markets was cooling, a US Federal Reserve rate decision on Wednesday and a Bank of Japan policy update on Thursday meant there was little incentive for traders to be bold.

The dollar index was trading 0.3% lower on the day at 94.86. Against the euro, it dipped to $1.12, at the weaker end of a 10-cent range it has held for a year, while the yen rose to 111.16 after a walloping at the end of last week.

Sterling, meanwhile, had hit its highest in over a month after a UK media blitz from President Barack Obama calling for Britain to stay in the European Union saw bookmakers lengthen the odds on a Brexit vote in June.

The subdued start to the week for Europe’s markets, was further compounded by an unexpected dip in German business morale amid simmering global growth concerns.

The Munich-based Ifo economic institute said its business climate index, which surveys around 7,000 firms, edged down to 106.6 in April compared to a forecast of a rise to 107.0. That was still well above the survey’s long-term average, but also its fourth fall in five months.