Bonds gain, U.S. stocks muted after weak European data
BNN Bloomberg
Global bonds rallied and stock markets were muted Monday, as sharp declines in manufacturing and services gauges across Europe fanned concerns about economic growth.
Investors were wary of making big equity bets at the start of a week packed with major central bank policy decisions and corporate earnings. In Europe, advance readings of the Purchasing Managers' Indexes showed the private-sector economy contracted more than anticipated in July in the euro area and slowed sharply in Britain.
The data highlights the quandary for policy-setters, with traders positioning for the Federal Reserve and the European Central Bank to raise interest rates this week and to signal whether more hikes are likely after record tightening campaigns.
Equity markets, meanwhile, are looking into their busiest earnings week this season, with more than 500 major companies worldwide due to report quarterly results, including US megacaps such as Alphabet Inc., and Meta Platforms Inc. The next few days will be crucial for investors, who will be watching to see if slowing economic momentum shows up on profit margins.
