World markets subdued as Wall Street rally loses momentum
SEOUL, Korea, Republic Of — Stock markets in Europe and Asia were subdued Tuesday as the afterglow from Wall Street’s overnight rally faded.
KEEPING SCORE: Germany’s DAX shed 0.4 per cent to 12,239 and the CAC 40 of France fell 0.3 per cent to 5,122. Britain’s FTSE 100 was wobbling in and out of negative territory, edging 0.2 per cent higher to 7,191. S&P futures lost 0.6 per cent and Dow futures were 0.5 per cent lower, auguring a downbeat start for trading on Wall Street.
WHERE THINGS STAND: Sentiment is jittery after it took just nine days for stocks to plunge 10 per cent from their latest peak, which was reached on Jan. 26. A drop of that size is known on Wall Street as a market “correction.” According to LPL Financial, it was the swiftest move from a record high to a correction in the history of the S&P 500. The index rose 1.5 per cent Friday but still wound up with its worst weekly loss in more than two years.
US INFLATION: A key question is whether the correction has already hit bottom, said Jingyi Pan, a market strategist at IG. “Nevertheless, the worst is likely not over for this week for the simple reason that we have U.S. CPI sitting as a mammoth event risk this week,” said Pan, referring to the Wednesday release of U.S. consumer price index data for January. Concerns over inflation helped caused last week’s market plunge, so the data will be watched closely.