One-week rate hikes from 2020 have stocks for a steep slide

  • Everyone except BOJ is hiking
  • Stocks will sink as economic risks grow
  • The yen is slipping as the BOJ policy remains unchanged

SINGAPORE, June 17 (Reuters) – Global stock markets headed for the worst week since the epidemic of markets in March 2020 as rising interest rates in the US and UK and a surprise stop put investors on the brink of future economic growth.

The Bank of Japan is coming out on Friday, the only week in which money prices around the world have risen, sticking to its strategy of bringing 10-year yields close to zero. read more

The yen was down more than 1% at 133.88 against the dollar in volatile trade. U.S. Futures made a bounce attempt and Chinese stocks gained, but it was set against a week of losses and worried that rate hikes would stifle growth for years.

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Wide index of MSCI of Asia-Pacific equities outside Japan (.MIAPJ0000PUS) The ASX 200 was towed for sale in Australia (.AXJO) Decreased by 1.8%. Nikkei of Japan (.N225) It fell 1.7% to a weekly fall of almost 7%.

The S&P 500 futures are up 0.8% and the Nasdaq 100 futures are up 1%, but they are still well underwater for the week.

EuroSTOXX 50 futures up 1% and FTSE futures up 0.5%.

Vincent Mortier, chief investment officer at Amundi, Europe’s largest financial manager, said: “We are entering a difficult phase of regime change because the risks of economic growth are already adding to the backdrop of hot inflation.

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“The current revaluation takes the bulk of the overvaluation from the market, but the current levels are vulnerable to any decline in corporate fundamentals.”

Global stocks (.MIWD00000PUS) It has fallen 5.7% per week so far, the steepest weekly percentage decline for more than two years.

One way

Bonds and coins trembled after a rollercoaster week. In recent sessions, the dollar has retreated from a 20-year high, but it has not fallen far and is ready to end the week smoothly.

The Swiss franc leap this week caused further drag as it was used as a financial currency and was often converted into dollars before being converted to higher earners – meaning the dollar would sell when trading turned upside down.

The greenback was firm on Friday and except for the yen, the euro was up about 0.3% at $ 1.0518 and the Aussie was up 0.5% at $ 0.7012.

“The path to lower resistance is lower stocks and higher dollars,” said Brent Tonelli of Spectra Markets. “Neither the central bank nor we know where inflation is going.”

The central bank and the Swiss central bank, the Bank of England, announced a 25 basis point increase this week. It was smaller than expected, but prompted the Guilds to sell out and bet that future hikes would come thicker and faster. read more

“If a central bank does not move aggressively, yield and risk prices will increase on the road,” said John Briggs, a strategist on the Northwest market.

“As the pace of global central bank policy is all the same, markets may continue to adjust with the outlook for higher global policy rates.”

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Sterling rose 1.4% on Thursday and retained profits until Friday when it went into a steady week. The two-year Guilds rose 18 basis points to 2.143% on Thursday.

U.S. Labor and Housing data on Thursday showed disappointing retail figures, worries hitting the dollar and helping the Treasury. read more

Benchmark 10-year Treasury revenue fell nearly 10 bps overnight but rose to 3.2313% in Asia morning. Yields rise when prices fall.

Before prices stabilized, growth fears took a toll on low travel. Brent crude was at $ 119.70 a barrel. Gold was at $ 1,844 an ounce and Bitcoin at $ 20,700.

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Report by Tom Westbrook; Editing Lincoln Feast.

Our standards: Thomson Reuters Trust Principles.

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