European stocks fell and the US dollar rose Monday, out of concerns that the US Federal Reserve is not keen to continue strengthening its balance sheet, with investors wary of the remainder of US President Donald Trump’s term as well.
Last week up 3%, the Stoxx Europe 600 SXXP,
decreased 0.4%.
US Equity Futures ES00,
fell, and the dollar DXY,
rose.
Bond Yields TMUBMUSD10Y,
those moving in the opposite direction of prices have picked up on concerns that the Federal Reserve will be less interested in maintaining the rate of its purchases of it. On Friday, Federal Reserve Vice Chairman Richard Clarida said he expected the current pace of bond purchases to continue through the end of the year. Other Fed officials have started talking about phasing out those purchases later in 2021.
Utilities SX6P,
often referred to as bond proxies, were the worst performing sector in Europe on Monday.
Markets are also keeping a close eye on politics, as House Speaker Nancy Pelosi said articles on impeachment would be introduced if Trump is not removed by invoking the 25th Amendment. Vice President Mike Pence, the target of Trump’s anger, is reportedly not interested.
“Markets are opening this morning with a small swing on the risk axis as investors may hit a tipping point in the short term. It is too early to say, however, as investors are grounded and roar like lions, supported by a long vaccine course paved with US stimulus measures, ”said Stephen Innes, chief strategist for the global market at Axi.
From Stocks in Motion, Signature Aviation SIG,
Up 8% to 438 pence, after accepting a $ 4.63 billion offer from Global Infrastructure Partners, which values the airline services company at 405 pence per share. Rival private equity groups Carlyle Investment Group and Blackstone have separately indicated an interest in the company.
JD Sports Fashion JD,
Up 5% after saying pre-tax profit for the year ended January 31 will be at least £ 400 million, compared to market expectations of £ 295 million. The sporting goods retailer adding next year’s profits will grow between 5% and 10%.
Smith & Nephew SN,
the UK medical device manufacturer fell 3% after saying its adjusted sales fell 7% in the fourth quarter, hurt by the COVID-19 pandemic that led to postponement of medical procedures.