LONDON (AFP/APP): Asian and European stocks struggled Wednesday as investors digested a barrage of company results and assessed the US Federal Reserve’s interest rate plans, while oil plumbed more multi-month lows on energy demand worries.
London stocks edged higher, aided partly by a ten-percent surge in retail stalwart M&S after it announced bumper profits and a return to the first shareholder dividend in four years.
Paris also rose with lender Credit Agricole jumping two percent after logging a solid third-quarter performance, but Frankfurt flatlined with Commerzbank falling 2.5 percent despite lifting its annual guidance and posting rising quarterly profit.
“European markets are hovering around the flatline as investors digest a slew of earnings reports,” said Victoria Scholar, head of investment at trading firm Interactive Investor.
Oil prices sank to levels last seen in July on heightened demand fears arising from the weak global economy.
Crude had already plunged about four percent the previous day on news that China’s exports fell at a faster pace than predicted in October. That stoked fresh concern over its appetite for energy.
“Oil prices tumbled head over heels,” noted analyst Stephen Innes at SPI Asset Management.
“This sharp decline was primarily driven by concerns about the outlook of global demand due to weak data points from China and other economies.”
Asian stock markets meanwhile wobbled Wednesday with US monetary policy is in focus after the US central bank hinted last week at no more tightening.
However, Fed officials refuse to commit one way or the other for now, instead saying they want to see more evidence that inflation is on a true downward slope and the labour market has softened enough.
Data on Friday that showed jobs creation was slowing — but not too much to cause worry about the economy — instilled confidence the Fed was on course to deliver a soft landing for the economy and avoid a recession.
Chicago Fed boss Austan Goolsbee gave little away Tuesday, saying he was lasering in on getting control of prices.
“We’ve got to get inflation down — that’s the number-one thing,” he told CNBC. “I’m absolutely hammering that’s what we should be watching.” He added that it was looking possible to do that without hurting the economy.
