Technology retreat leads US equities lower - 16.10.2018

Budget deficit jump weighs on dollar

US stocks edged lower on Monday pairing part of Friday gains as technology shares retreated. The S&P 500 slid 0.6% to 2750.79. Dow Jones industrial slipped 0.4% to 25250.55. The Nasdaq composite index fell 0.9% to 7430.74. The dollar strengthening halted on mixed data: US budget deficit jumped to $779 billion, and the 0.1% rise in retail sales in September was less than expected. The live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, lost 0.2% to 95.023 but is higher currently. Futures on stock indices indicate higher openings today.

European indices open mixed

European stocks rebounded on Monday after retreats sparked by US equities selloff last week. Both EUR/USD and GBP/USD turned higher despite the ruling Christian Social Union, member of the German coalition government, lost its absolute majority in Bavaria regional election while the UK and the European Union failed to find a compromise for the Irish border over the weekend. Both currency pairs are rising currently. The Stoxx Europe 600 index added 0.1%. The DAX 30 rose 0.8% to 11614.16 while France’s CAC 40 slipped less than 0.1%. UK’s FTSE 100 gained 0.5% to 7029.22. Markets opened mixed today.

NIKKEI best performer among Asian indices

Asian stock indices are mixed today after broad Monday losses. Nikkei rose 1.3% to 22549.24 helped by yen turning lower against the dollar. Chinese shares extended losses despite report consumer inflation jumped from 2.3% in August to 2.5% in September, 7-month high: the Shanghai Composite Index is down 0.9% and Hong Kong’s Hang Seng Index is 0.1% lower. Australia’s All Ordinaries Index rebounded 0.6% as the Australian dollar resumed slide against the greenback.

Brent slips

Brent futures prices are falling today on expectations of a rise in US crude oil inventories after three straight weekly builds. Prices rose yesterday on tensions between the US and Saudi Arabia linked to a missing dissident journalist. Saudi Arabia vowed stronger retaliation against any sanctions from Washington after reports dissident Saudi journalist Jamal Khashoggi disappeared after entering the Saudi consulate in Istanbul on October 2. Prices ended higher yesterday: December Brent crude rose 0.4% to $80.78 a barrel on Monday.