US stocks slipped Thursday as investors digested comments from Federal Reserve Chair Jerome Powell, while worries over Donald Trump’s presidency clouded optimism.
Bitcoin dipped below the $90,000 level after striking a record of $93,462 on Wednesday.
Observers are expecting it to soon top $100,000 following pro-crypto pledges from the US president-elect.
Investors were looking to a speech Thursday by Powell for indications about future interest rate cuts, but his remarks cooled expectations of a December reduction.
Powell told a conference in Texas that the path of rate cuts “is not preset,” adding that “the economy is not sending any signals that we need to be in a hurry to lower rates.”
“The inflation data this week and the Fed Chair Powell’s comments today have pushed down the expectations of a rate cut in December,” Ventura Wealth Management chief investment officer Tom Cahill told AFP. “That’s what’s troubling the market.”
US consumer inflation data released on Wednesday showed that consumer prices rose in line with forecasts.
With Trump having vowed to impose across-the-board tariffs, that could boost inflation and give the Fed reason to pause cutting interest rates.
“As things stand, the market is cautiously pricing in just 50 basis points of easing by mid-2025 — a marked revision from before the US election” when it expected more cuts, said City Index and FOREX.com analyst Fawad Razaqzada.
Meanwhile data released on Thursday showed upticks in wholesale price inflation, which could also give the Fed reason to reevaluate the need to cut rates further.
“The higher interest rates, I think, are kind of acting as a headwind of sorts for the equity market right now,” said Patrick O’Hare of Briefing.com.
Wall Street’s main indices opened with modest gains, but then dipped lower.
European markets fared better, with updated data confirming the eurozone recorded 0.4 percent growth in the third quarter.
Tokyo, Hong Kong and Shanghai all fell on Thursday as concerns over another possible China-US trade war, and Beijing’s economic woes, weighed on Asian markets.
The greenback topped 155 yen for the first time since July, putting focus on Japanese authorities who have said they are prepared to support their unit if they considered moves to be one-sided or speculative.
In company news, shares in Disney closed 6.2 percent up after the entertainment giant beat expectations in its latest quarterly earnings.
While its net profits dipped, its earnings per share excluding exceptional items beat analyst expectations, as did a six percent increase in sales.
Shares in Meta were barely dented after the EU fined it almost 800 million euros ($840 million) on Thursday for breaching antitrust rules by giving users of its Facebook social network automatic access to classified ads service Facebook Marketplace. Meta said it would appeal the decision.
Shares in struggling British fashion house Burberry rose around 20 percent on London’s FTSE 250 as the group announced cost-cutting plans after posting a loss.
Key figures around 2140 GMT
New York – Dow: DOWN 0.5 percent at 43,750.86 points (close)
New York – S&P 500: DOWN 0.6 percent at 5,949.17 (close)
New York – Nasdaq Composite: DOWN 0.6 percent at 19,107.65 (close)
London – FTSE 100: UP 0.5 percent at 8,071 (close)
Paris – CAC 40: UP 1.3 percent at 7,311.80 (close)
Frankfurt – DAX: UP 1.4 percent at 19,263.70 (close)
Tokyo – Nikkei 225: DOWN 0.5 percent at 38,535.70 (close)
Hong Kong – Hang Seng Index: DOWN 2.0 percent at 19,435.81 (close)
Shanghai – Composite: DOWN 1.7 percent at 3,379.84 (close)
Dollar/yen: UP at 156.28 yen from 155.51 yen on Wednesday
Euro/dollar: DOWN at $1.0524 from $1.0564
Pound/dollar: DOWN at $1.2662 from $1.2710
Euro/pound: FLAT at 83.11 pence from 83.11 pence
West Texas Intermediate: UP 0.4 percent at $68.70 per barrel
Brent North Sea Crude: UP 0.4 percent at $72.56 per barrel
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