FTSE 100 called lower; Asian stocks struggle

May 21, 2024 at 11:22 am IST

(Alliance News) - Stocks in London are set to open lower on Tuesday, following mixed trade in New York overnight and declines in the Asian session.

IG says futures indicate the FTSE 100 to open down 47.5 points, 0.6%, at 8,376.70 on Tuesday. The index of London large-caps closed up 3.94 points at 8,424.20 on Monday.

The pound was quoted at USD1.2711 early Tuesday in London, up from USD1.2702 at the time of the European equities close Monday. The euro stood at USD1.0861, flat from USD1.0862. Against the yen, the dollar was trading at JPY156.30, up from JPY156.14.

In New York on Monday, the Dow Jones Industrial Average closed down 0.5%, the S&P 500 added 0.1% and the Nasdaq Composite rose 0.7%.

The US Federal Reserve should keep interest rates at their current elevated levels for longer than previously expected due to disappointing recent inflation data, a senior bank official said Monday.

Speaking at a conference in the US state of Florida on Monday, Fed vice chair for supervision Michael Barr said the bank had made "tremendous progress" in bringing inflation down from its 2022 peak, while unemployment – the other leg of its dual mandate – had remained low.

"We are not yet all the way to our target of 2%," he said in prepared remarks, noting the "disappointing" recent inflation data.

"These results did not provide me with the increased confidence that I was hoping to find to support easing monetary policy by reducing the federal funds rate," he said.

"This means that we will need to allow our restrictive policy some further time to continue to do its work," added Barr, a permanent voting member of the Fed's rate-setting committee.

Also speaking Monday, Fed Vice Chair Philip Jefferson – another permanent voting member of the Fed's rate-setting committee – said inflation was still coming down, "although nowhere near as quickly as I would have liked."

"In making judgments about the appropriate stance of policy rate over time, I will be carefully assessing the incoming data, the evolving outlook, and the balance of risks," he said in prepared remarks for a conference in New York.

In Asia, the Shanghai Composite was down 0.2% in afternoon dealings, while the Hang Seng in Hong Kong was 1.8% lower. In Tokyo, the Nikkei 225 was down 0.1% in late trade, while Sydney's S&P/ASX 200 was 0.2% lower.

Gold was quoted at USD2,414.12 an ounce early Tuesday, down from USD2,423.50 late Monday afternoon. Brent oil was quoted at USD83.13 a barrel, falling from USD83.65.

In Tuesday's UK corporate calendar, there is a trading statement from DIY retailer Kingfisher.

By Eric Cunha, Alliance News news editor

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