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The rally in risk assets took a breather amid further signs China’s economy is cooling. That weighed on commodities including base metals, which in turned dragged down mining stocks. Most major currencies drifted before U.S. inflation data, while the pound jumped as the Bank of England held interest rates but signaled the possibility of stimulus reduction.
Major European gauges were mixed following fluctuations in benchmarks from Tokyo to Sydney through the Asian session. The dollar rally lost steam but the currency held most of its recent gains, supported by a slight increase in expectations of a U.S. interest-rate rise this year and President Donald Trump’s push for bipartisan support on tax reform. Oil extended gains as copper fell to near the lowest level in a month. Sterling advanced as a majority of policy makers said there’s scope for stimulus reduction “in the coming months.”
Chinese retail sales, industrial production and fixed-asset investment all slowed last month after a lackluster July as efforts to rein in credit expansion and reduce excess capacity in the world’s second-largest economy hit home. Still, renewed hope for a U.S. tax overhaul was spurred by House Speaker Paul Ryan saying the plan is to have a new tax system functioning next year.
Elsewhere, the Australian economy added 54,200 jobs in August from July, more than twice as many as economists estimated. And the Swiss National Bank tweaked its formal view of the franc’s level; the currency weakened.
Terminal subscribers can read more in our Markets Live blog.
Still to come this week:
- The highlight for the U.S. session will be the consumer-price data. Jobless claims come at the same time, while industrial production is Friday.
Here are the main moves in markets:
- The Stoxx Europe 600 Index increased less than 0.05 percent as of 12:05 p.m. London time.
- The MSCI All-Country World Index decreased 0.1 percent.
- The U.K.’s FTSE 100 Index sank 0.3 percent to the lowest in more than a week.
- The MSCI Emerging Market Index gained less than 0.05 percent.
- Futures on the S&P 500 Index fell 0.1 percent.
- The Bloomberg Dollar Spot Index declined 0.1 percent.
- The euro increased 0.1 percent to $1.1897.
- The British pound advanced 0.5 percent to $1.3283, the strongest in a year.
- The yield on 10-year Treasuries fell less than one basis point to 2.19 percent.
- Germany’s 10-year yield fell less than one basis point to 0.40 percent.
- Britain’s 10-year yield rose two basis points to 1.165 percent, hitting the highest in almost six weeks.
- Gold increased 0.1 percent to $1,324.28 an ounce.
- West Texas Intermediate crude gained 0.8 percent to $49.69 a barrel, the highest in five weeks.
- Copper fell 1.3 percent to $2.94 a pound, the lowest in a month.
- The Topix index fell 0.3 percent at the close in Tokyo. Australia’s S&P/ASX 200 Index lost 0.1 percent and South Korea’s Kospi index added 0.7 percent. The Hang Seng Index in Hong Kong slipped 0.4 percent. Benchmarks in China also declined.
- The Aussie jumped as high as 80.16 U.S. cents after the jobs data before pulling back when the China numbers were released.
- The Japanese yen was little changed.
- The MSCI Asia Pacific Index fell 0.1 percent.
— With assistance by Adam Haigh, and Robert Brand