Image Source: Pexels

• Global stock markets experienced a downturn for the second consecutive day.
• Market projections are set for a 0.4% monthly increase and a 3.1% rise on an annual basis.
• The MSCI global stock index and European indices like the STOXX 600 and FTSEurofirst 300 also faced declines.

Global stock markets experienced a downturn for the second consecutive day, retreating from recent record highs.

Investors are holding their breath for the upcoming US inflation report, anticipated to play a critical role in shaping the Federal Reserve’s interest rate decisions.

Despite achieving multiple record highs this year, the stock market saw a decline following a mixed US employment report last Friday, which barely swayed the Fed’s expected rate cut timeline.

US inflation data in focus

All eyes are now on the US inflation data set for release on Tuesday. Market projections are set for a 0.4% monthly increase and a 3.1% rise on an annual basis.

Amidst the anticipation, major US stock indices witnessed a fall; the Dow Jones Industrial Average dropped by 0.46%, the S&P 500 by 0.35%, and the Nasdaq Composite by 0.17%.

Analysts weigh in

Market experts, including CFRA Research’s Sam Stovall, suggest that stocks are ripe for a pullback, driven by overly optimistic valuations and sentiment indicators.

The upcoming inflation data and potential Fed commentary on interest rates are seen as possible catalysts for a market correction, along with adjusted earnings forecasts for 2024.

The MSCI global stock index and European indices like the STOXX 600 and FTSEurofirst 300 also faced declines, highlighting a broader trend of market hesitation.

With the Federal Reserve’s policy statement due on March 20, investors are nearly unanimous in their expectation for rates to remain unchanged, contrary to previous speculations of a summer rate cut.

Currency and commodity markets react

The dollar index saw a slight increase, while the Japanese yen showed marginal strength against the dollar, following reports of the Bank of Japan’s consideration to end negative interest rates.

The US treasury yields edged higher, and oil prices fell amid geopolitical tensions and concerns over demand in China. In contrast, Bitcoin surged 5.36%, reaching a new record high.

More By This Author:

Bitcoin Rockets Past $71K, Sets A New ATH As Bitcoin Dogs ICO Approaches $10M
Bitcoin Soars Past $71k To New All-time High, Will It Hit $100k In 2024?
GBP/INR Forecast: Here’s Why Sterling Is Outperforming Its Peers