A stumble from the Dow Jones last night, a shift in policy from the Bank of Japan, frosty words between the US and China, and a third covid-19 wave in France all undermined sentiment this Friday.
Though the Federal Reserve and Bank of England made it clear they wouldn’t be turning the stimulus taps off any time soon, that hasn’t stopped the Bank of Japan’s decision to move to a more ‘sustainable’ monetary policy from upsetting the apple cart.
Accusations of ‘grandstanding’, meanwhile, were the main take away from the first high-level talks between China and the Joe Biden government. It’s going to be difficult to undo the toxic relationship that blossomed during the Trump administration, especially when Biden is not only looking to repair, but push back on acts that secretary of state Antony Blinken claimed ‘threaten the rules-based order that maintains global stability.’
More specifically Euro-centric, Paris and parts of northern France are entering a 4-week lockdown to combat a third wave of the coronavirus that is currently sweeping through the nation.
It should be clear, then, why the European markets weren’t exactly feeling it after the bell.
After yesterday’s record close, the DAX dropped back by 0.5%, but managed to hold above 14,700. The CAC, meanwhile, shed 0.7%, leaving it at 6,025.
The FTSE, which has missed out on the all-time and one-year highs of its peers, shrank by 0.7%, putting it at a rough one-week low.
Rising bond yields meant that the Dow Jones finished Thursday down around 150 points. It is set to recover, but only slightly, this afternoon, with the futures pointing to a 0.1% increase when trading gets underway.
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