With the Dow Jones futures turning from green to red, the European indices took another dive this morning.
The FTSE can perhaps be relieved that its 0.7% decline, one that took it to sub-7200 lows not seen in over a fortnight, wasn’t any worse this Wednesday. Not only has it been hit by the wider rate hike-fearing sentiment, the index is also dealing with a retail sector seemingly careening towards disaster, a 13.5% plunge from WPP (LON:WPP) following the firm’s worst year for growth since 2009 and some pretty dire manufacturing data. Though the PMI came in a smidge higher than forecast at 55.2, that still meant it hit an 8 month low, news that also contributed to the pound’s 0.2% drop against the dollar and 0.1% fall against the euro.
If the FTSE wants an example of how bad things could be, then it needs look no further than the eurozone. The DAX plunged 170 points, sending the index to a 2 week low, while the CAC found itself down by 1%.
Looking to this afternoon and the US session seems stacked against the markets. The core PCE price index, a favourite inflation measure of the Fed, is set to rise from 0.2% to 0.3% month-on-month, while February’s Markit manufacturing PMI is forecast come in at 55.9 against January’s 55.5. Perhaps most damningly there is another testimony from Jerome Powell on the cards, with the central bank chief expected to reiterate his hawkish, pro-US economy comments from Tuesday.
No wonder the Dow Jones is threatening to fall below 25000 after the bell rings on Wall Street.
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