NEW YORK (Reuters) – A gauge of global stocks sputtered for a third straight session, unable to build on a surge in Chinese shares, while the Canadian dollar weakened after dovish commentary from the Bank of Canada.
FILE PHOTO: Signage is seen outside the entrance of the London Stock Exchange in London, Britain. Aug 23, 2018. REUTERS/Peter Nicholls
Major U.S. indexes once again struggled to muster any positive momentum, with the S&P 500 appearing to have met a strong resistance point around the 2,800 level. After a strong start to the year, a lack of developments in trade negotiations between the United States and China has provided little incentive for investors to push equities higher.
“We started the year with a lot of fears and uncertainty and some of that has abated, but now there’s not a lot of catalysts to push the markets one way or the other,” said Scott Brown, chief economist at Raymond James in St. Petersburg, Florida.
“It’s going to be more of this back and forth for a while until the trade picture gets clearer.”
The Dow Jones Industrial Average fell 83.23 points, or 0.32 percent, to 25,723.4, the S&P 500 lost 9.61 points, or 0.34 percent, to 2,780.04 and the Nasdaq Composite dropped 40.22 points, or 0.53 percent, to 7,536.14.
Even with little on the trade front, Chinese shares surged to a nine-month high, bolstered by hopes of more stimulus measures from Beijing after China’s state planner said the government would implement measures to further boost domestic consumption to counter the impact of a slowing economy.
European shares also dipped, although declines were curbed by a rise in bank shares after Bloomberg reported the European Central Bank is holding discussions on the design of new ultra-cheap bank loans ahead of its meeting on Thursday.
The pan-European STOXX 600 index lost 0.13 percent and MSCI’s gauge of stocks across the globe shed 0.17 percent.
In the latest sign of global central bank dovishness, the Bank of Canada held interest rates steady as expected on Wednesday amid a slowing economy and said there was “increased uncertainty” around the timing of future rate increases.
That in turned pushed the Canadian dollar to its worst level in about two months versus the greenback.
The dollar index fell 0.04 percent, with the euro up 0.11 percent to $1.1319.
The Canadian dollar fell 0.65 percent versus the greenback to 1.34 per dollar.
The Federal Reserve’s Beige Book, a compendium of anecdotes on the health of the economy drawn from the central bank’s sources across the nation, is expected at 2 p.m. ET (1800 GMT).
U.S. oil prices pared losses and Brent prices were little changed after data from the Energy Information Administration showed U.S. crude stockpiles rose much more than expected last week.
U.S. crude fell 0.83 percent to $56.09 per barrel and Brent was last at $65.81, down 0.08 percent on the day.
Additional reporting by Medha Singh; Editing by Susan Thomas