Global stocks advanced on Monday yet still hovered near six-week lows as economic data last week encouraged investors to brace for higher interest rates in the United States and Europe going forward.
Futures on the S&P 500 edged 0.1% higher, while those on the Nasdaq gained 0.2%. European stocks are on the mend, with the Stoxx 600, which lost 1.4% last week, rising 1%. The MSCI All-World index of global shares gained 0.1% on Monday after losing 2.6% last week; its largest weekly loss in the year to date. The global index remains on track for a 3% decline in February.
CityIndex market strategist Fiona Cincotta believes that the recent market slump comes as once overly-confident investors now come to terms with reality. “We’ve had a series of really strong macro data come through and I think that’s just brought this reality check to the market, which had been completely ignoring it and are actually now on the same page as the Fed, which I think is a good thing,” she commented.
The US dollar’s monthly rally came to a halt on Monday, with the currency appearing flat at 105.12 during early trading Monday. This comes as the sterling gained 0.3% to $1.1945 and the yen advanced 0.1% to 136.35.