Markets mixed as dealers eye inflation data

·4-min read
Tesla shares tumbled after Elon Musk's Twitter followers voted in favor of him selling shares of his company (AFP/Frederic J. BROWN)

Global stock markets were mixed on Monday as investors digested a huge US infrastructure bill and braced for fresh inflation data, while Tesla's Elon Musk provided some drama with a controversial tweet.

London's FTSE 100 and Frankfurt's blue-chip Dax index closed flat, but the Paris CAC 40 finished higher.

The Dow Jones Industrial Average and the tech-heavy Nasdaq were up 0.1 percent in midday trading but the S&P 500 was flat.

Asian markets were also mixed at the close of trading.

Markets had surged Friday on blockbuster US job creation data, which showed recovery was well underway in the world's top economy.

The passage of US President Joe Biden's $1.2 trillion infrastructure bill added to the optimism, though it could also fuel inflation concerns.

"It is calm start to the week for most markets, although the Dow has already managed to poke its head into new record high territory, maintaining at least some of the momentum from last week," IG chief market analyst Chris Beauchamp said.

But he referred to "a sense of exhaustion across equity markets that reflects the strong gains seen over the past month and more".

Investors are now awaiting vital US consumer price inflation data due Wednesday.

"The big risk is if we see (a) massive spike in US CPI inflation – unlikely, but not totally out of question," said Fawad Razaqzada, analyst at ThinkMarkets.

Fed Vice Chair Richard Clarida issued the clearest signal yet that the US central bank is preparing the way for further steps to contain inflation and normalise monetary policy after last week announcing it would begin cutting back its pandemic stimulus.

"While we are clearly a ways away from considering raising interest rates," Clarida said he believes the "necessary conditions for raising the target range for the federal funds rate will have been met by year-end 2022."

Tesla stood out as its price sank after Twitter users voted for Musk, the head of the electric car giant, to sell 10 percent of his shares in a poll he posted on his social media account.

Bitcoin surged above $66,000 to near its record peak on feverish demand, as the combined value of all cryptocurrencies topped $3 trillion, according to data provider CoinGecko.

Oil rallied further after OPEC and other major producers refused to heed US calls last week to ramp up output to meet a surge in demand.

- Europe stocks 'subdued' -

"European markets have seen a subdued start to the week, with little directional bias one way or the other," said Michael Hewson, chief market analyst at CMC Markets UK, just before markets closed in London, Frankfurt and Paris.

Hewson added: "US markets have started the week on a fairly modest note, as the spillover effect of Friday's positive payrolls report continues to ripple out into the new trading week."

Optimism continues to be held back by worries about inflation, which has surged this year owing to a pick-up in demand, a spike in energy prices and supply chain snarls -- forcing central banks around the world to start rowing back their massive pandemic-era support measures.

- Key figures around 1750 GMT -

New York - Dow: UP 0.1 percent at 36,362.38

London - FTSE 100: DOWN 0.5 percent at 7,300.40 (close)

Frankfurt - DAX: DOWN 0.05 percent at 16,046.52 (close)

Paris - CAC 40: UP 0.09 percent at 7,047.48 (close)

EURO STOXX 50: DOWN 0.24 percent at 4,352.53 (close)

Tokyo - Nikkei 225: DOWN 0.4 percent at 29,507.05 (close)

Hong Kong - Hang Seng Index: DOWN 0.4 percent at 24,763.77 (close)

Shanghai - Composite: UP 0.2 percent at 3,498.63 (close)

Euro/dollar: UP at $1.5884 from $1.1567 at 2100 GMT Friday

Pound/dollar: UP at $1.3550 from $1.3498

Euro/pound: DOWN at 85.49 pence from 85.69 pence

Dollar/yen: DOWN at 113.24 from 113.41 yen

Brent North Sea crude: UP 1.0 percent at $83.57 per barrel

West Texas Intermediate: UP 0.9 percent at $81.98 per barrel

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