Shares Set For Expansion Decline As The Fear Of Growth Grows

Shares Set For Expansion Decline As The Fear Of Growth Grows

A haven bid for Treasuries eased. Uncertainty over how far the Federal Reserve will hike interest rates to stem inflation continues to shadow bonds.

A dollar gauge dipped but remained in sight of the highest level since 2020. In cryptocurrencies, Bitcoin added over $1,000 after sliding below $30,000.

“For now investors need to be prepared for continued volatility,” Solita Marcelli, Americas chief investment officer at UBS Global Wealth Management, wrote in a note. She added “sentiment is bearish” but not capitulating.

China’s growth-sapping Covid lockdowns, a global wave of monetary tightening and the war in Ukraine continue to cast a pall over the world economy. In a semi-annual report, the Fed warned of deteriorating liquidity conditions across key financial markets.

Story Highlights

  • An Asia-Pacific equity gauge Tuesday trimmed a drop of about 2% in half, aided by a turnaround in China. S&P 500 and Nasdaq 100 contracts rose, pointing to steadier sentiment following a Monday rout in U.S. shares.

  • Oil fell toward $101 a barrel on the economic worries and the European Union’s move to soften some proposed sanctions on Russian oil over the Ukraine war.

In the latest policy comments, Fed Bank of Atlanta President Raphael Bostic said he favors continuing to raise rates by half-point moves rather than anything larger. He said the odds for a 75-basis-point hike are low but added he’s taking nothing off the table.

Investors are awaiting the April U.S. consumer-price index print on Wednesday to gauge whether inflation is peaking.