Stocks lower on uncertainty over tech rally, US rates / Photo: © AFP
Stocks lower on uncertainty over tech rally, US rates
Stock markets struggled on Monday on concerns the US Federal Reserve could hold off on further rate cuts this year and fears of a tech bubble.
Meanwhile, simmering tensions between China and Japan hit tourism and retail firms on Tokyo's exchange.
The tepid mood on trading floors dragged on the crypto sector, with bitcoin briefly erasing all its gains this year -- just over a month after hitting a record high.
Major European indices edged lower, tracking losses in Asia.
The European Union on Monday cut its eurozone growth forecast for 2026 as risks from international trade and geopolitical tensions weigh on Europe's economy.
Investors have in recent weeks reconsidered prospects for US rate cuts and the AI-fuelled tech rally that had lifted several markets to record highs.
Traders are keenly awaiting the release of several reports -- including on jobs and inflation -- that had been held up by the record US government shutdown that ended last week.
With data releases delayed, "chances are growing that the Fed will avoid changing monetary policy when the economic outlook remains murky", said Kathleen Brooks, research director at trading group XTB.
Federal Reserve boss Jerome Powell signalled last month that a December cut to borrowing costs was not assured, adding to uncertainty.
There is also growing unease surrounding lofty tech valuations, with warnings that an AI bubble could soon burst.
All eyes are on this week's release of earnings from chip titan Nvidia, which this month became the first $5.0 trillion company.
After a tepid end to the week on Wall Street, major Asian indices closed lower on Monday.
Tokyo fell as figures showed Japan's economy shrank 0.4 percent in the three months to September.
Tourism and retail firms were among the worst hit after China advised its citizens not to travel to Japan amid a diplomatic spat over comments by Prime Minister Sanae Takaichi about Taiwan.
Cosmetics firm Shiseido dived more than nine percent and Uniqlo-owner Fast Retailing shed 4.8 percent.
Department store group Mitsukoshi fell 11.3 percent and Pan Pacific, behind discount retail chain and tourist magnet Don Quijote, slid 5.3 percent.
China is the biggest source of tourists to Japan.
The diplomatic feud between China and Japan was ignited by Takaichi's suggestion that Tokyo could intervene militarily in any attack on Taiwan.
Bitcoin suffered from the uncertain climate on trading floors, with the digital unit briefly dropping to $92,935.51.
It bounced back slightly to sit above $95,000 on Monday.
The cryptocurrency climbed to a record high of $126,251 on October 6, buoyed by US President Donald Trump's pledges to ease regulation on the crypto sector.
- Key figures at around 1130 GMT -
London - FTSE 100: DOWN 0.1 percent at 9,684.69 points
Paris - CAC 40: DOWN 0.4 percent at 8,137.73
Frankfurt - DAX: DOWN 0.5 percent at 23,755.81
Tokyo - Nikkei 225: DOWN 0.1 percent at 50,323.91 (close)
Hong Kong - Hang Seng Index: DOWN 0.7 percent at 26,384.28 (close)
Shanghai - Composite: DOWN 0.5 percent at 3,972.03 (close)
New York - Dow: DOWN 0.7 percent at 47,147.48 (close)
Dollar/yen: UP at 154.83 yen from 154.55 yen on Friday
Euro/dollar: DOWN at $1.1598 from $1.1621
Pound/dollar: DOWN at $1.3165 from $1.3171
Euro/pound: DOWN at 88.09 pence from 88.22 pence
West Texas Intermediate: FLAT at $60.07 per barrel
Brent North Sea Crude: FLAT at $64.36 per barrel
(L.Møller--DTZ)
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