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Updated 5 hours ago
Macro
Matters
Marketmind: When the Dragon sneezes, Europe
catches a cold
Reuters
As pressure
builds on China's tech and real estate moguls and its economic growth falters,
markets worldwide are starting to get uneasy. But it's Europe, with its
export-oriented economy and supercharged luxury stocks reliant on affluent
Asian shoppers, which is likely to feel the most genuine pain.
The STOXX
600 index (.STOXX) has fallen 1% so far in September, twice as much world
stocks (.MIWO00000PUS), and while Europe broadly is still in favour with
investors and research analysts, the index has slipped all the way down to July
lows.
Wall
Street's strength overnight could trigger a relief bounce this morning, but the
China woes are far from over.
The
worsening crisis at China's No. 2 property developer Evergrande has sent its
shares to decade lows, pushed Asian stock markets to their fourth day of
losses. Trading in Evergrande bonds has been suspended. And virus outbreaks are
clouding travel plans during next week's Mid-Autumn Festival.
Europe Inc
faces internal woes too. Soaring power prices have prompted Spain to cap energy
bills and Italy said on Thursday it plans "short-term measures" to
offset the price rises. Worries are other governments could resort to similar
measures -- at the expense of utility firms.
There's
some market support from signs U.S. inflation has peaked and the world's
biggest economy is in robust shape. Retail sales will be eyed later on for more
clues on the health of the world's largest economy.
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