European Bourses Fall Amid Political Unease; Nasdaq Ends At New Record

European bourses fall amid political unease; Nasdaq ends at new record

Stock markets mostly retreated on Thursday as traders reacted to political uncertainty in Europe and the US Federal Reserve's plan to only cut interest rates once this year

New York, (UrduPoint / Pakistan Point News - 14th Jun, 2024) Stock markets mostly retreated on Thursday as traders reacted to political uncertainty in Europe and the US Federal Reserve's plan to only cut interest rates once this year.

European stocks closed firmly in the red, Paris and Frankfurt shedding around two percent each as investors continued to track fallout from far-right gains in last weekend's EU elections.

Returns were better on Wall Street, where both the S&P 500 and Nasdaq finished at fresh records following lower wholesale prices The Dow finished narrowly lower.

On Wednesday, the Federal Reserve left its key lending rate unchanged and penciled in just one rate cut this year, down from the three expected in March.

In France, the European Union's second-largest economy, President Emmanuel Macron is under pressure ahead of snap elections he called after a drubbing by the far right in EU-wide polls.

"Yesterday's cautious Fed meeting and ongoing political worries in Europe continue to put pressure on equity markets generally," said Chris Beauchamp, chief market analyst at online trading platform IG.

The early French legislative elections called for June 30 and July 7 "have sent investors scurrying from European stocks", he added.

The brighter performance by the Nasdaq index shows that "the technology sector remains the primary driver of market performance", according to FOREX.com market analyst Fawad Razaqzada.

"One has to wonder how much further the sector can hold up the market."

Investors were also keeping an eye on the yen as the Bank of Japan started a two-day policy meeting, with speculation swirling that it is preparing the ground for a further tightening after lifting interest rates in March for the first time in 17 years.

Japan has been an outlier in recent years, deciding against raising interest rates to fight high inflation. And just as major central banks are looking to cut borrowing costs, the BoJ has decided to start hiking them.

Among individual companies, Broadcom surged 12.3 percent as it lifted its full-year forecast on strong demand for artificial intelligence programs. The chip company also announced a ten-for-one stocks split.

Tesla rose 2.9 percent after CEO Elon Musk said shareholders backed his proposed compensation plan of up to $56 billion, as well as a transfer of the carmaker's place of incorporation from Delaware to Texas.

Markets had viewed a defeat as a potential negative for Tesla if Musk had chosen to exit the company.

- Key figures around 2010 GMT -

New York - Dow Jones: DOWN 0.2 percent at 38,647.10 (close)

New York - S&P 500: UP 0.2 percent at 5,433.74 (close)

New York - Nasdaq: UP 0.3 percent at 17,667.56 (close)

London - FTSE 100: DOWN 0.6 percent at 8,163.67 (close)

Paris - CAC 40: DOWN 2.0 percent at 7,708.02 (close)

Frankfurt - DAX: DOWN 2.0 percent at 18,265.68 (close)

EURO STOXX 50: DOWN 2.0 percent at 4,935.50 (close)

Euro/dollar: DOWN at $1.0746 from $1.0809 on Wednesday

Euro/pound: DOWN at 84.15 pence from 84.45 pence

Pound/dollar: DOWN at $1.2766 from $1.2798

Dollar/yen: UP at 157.03 yen from 156.72 yen

West Texas Intermediate: UP 0.2 percent at $78.62 per barrel

Brent North Sea Crude: UP 0.2 percent at $82.75 per barrel