Global stock markets drifted Tuesday on the eve of a key monetary policy update from the US Federal Reserve and ahead of earnings results from tech giants.
While trading floors are geared up for a rocket-fuelled surge in economic activity in the second half of the year and into the next, traders are in wait-and-see mode.
The Fed’s monetary policy meeting outcome on Wednesday is broadly expected to see it reassert its pledge to maintain ultra-loose policy until its goals on unemployment and inflation are met.
The Fed’s accompanying statement will be closely examined for clues on the state of the US economy and the future path for borrowing costs.
The central bank’s meetings are a crucial focus of investor interest as they continue to fret that the expected strong recovery will send prices soaring and force policymakers to raise the record low interest rates cementing a global rally.
US President Joe Biden, meanwhile, will make his first State of the Union address on Wednesday, in which he could unveil a $1.8-trillion American Families Plan that would provide national child care, paid family leave and free community college, paid for with higher taxes on the rich.
After Monday saw record high closes, Wall Street was barely creeping into the red two hours into trading.
Earlier, most Asian markets had swung in and out of positive territory with Tokyo, Hong Kong, Sydney, Seoul, Jakarta and Manila all in the red.
Major European markets all limited losses, London off 0.3 percent — aeronautics manufacturer Rolls Royce shed 4.5 percent — while Frankfurt and Paris also slipped into the red.
Google owner Alphabet and Microsoft was to publish first quarter results on Tuesday while Apple, Amazon and Facebook will release their figures later this week.
Elsewhere, oil prices rose before Wednesday’s key output meeting of OPEC and other major crude producers and in a sign economic recovery may be around the corner the price of copper hit a decade-high close to $10,000 a tonne, largely on strong Chinese demand and tight supplies of the metal used in popular electric wiring amid strike action in the world’s biggest producer Chile.
The price has more than doubled since dropping to $4,371 a tonne in March last year as the coronavirus pandemic took hold around the world.
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