US equities fall as technology shares sell off | IFCM
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US equities fall as technology shares sell off - 20.3.2018

Dow turns negative for 2018

US stock indices fell Monday erasing Friday gains as Facebook’s data management concerns triggered technology shares selloff. The S&P 500 lost 1.4% to 2712.92. The Dow Jones industrial dropped 1.4% to 24610.91, turning down 0.4% year to date. The Nasdaq composite index slumped 1.8% to 7344.24. The dollar weakened: the live dollar index data show the ICE US Dollar index, a measure of the dollar’s strength against a basket of six rival currencies, fell 0.3% to 89.903. Stock indices futures point to higher openings today.

The Federal Reserve two-day meeting starts today and the fed funds futures market is pricing in a 91.6% likelihood of a rate hike at this meeting. Investors also expect the Federal Reserve will take a more aggressive approach to interest rate increases. Central bank’s more hawkish monetary policy stance is expected to be reflected in the so called dot plot of policy makers’ projections of the fed funds rates. Federal Reserve’s last dot plot indicated policy makers expected to raise rates three times in 2018, this number may get revised to four.

Pound jumps on Brexit agreement

European stocks turned sharply lower on Monday. The euro joined the British Pound’s climb against the dollar. The Stoxx Europe 600 index fell 1.1%. The DAX 30 fell 1.4% to 12217.02. France’s CAC 40 lost 1.1% and UK’s FTSE 100 slumped 1.7% to 7042.93. Indices opened 0.2% - 0.4% higher today.

Pound crossed above $1.40 on news the European Union agreed on the broad terms of a two-year transition period for the UK after Brexit starts next year. Under the transition deal, the UK will continue implementing EU rules until the end of 2020. But The issue of the border dividing the Republic of Ireland, an EU member state, from Northern Ireland, the UK territory, remains unsolved.

Asian stock mixed

Asian stock indices are mixed today following Wall Street pull-back led by technology selloff. Nikkei fell 0.6% to 21352.50 despite continued yen slide against the dollar. Chinese stocks are higher despite news President Donald Trump is set to impose $60 billion in annual tariffs against China by Friday: the Shanghai Composite Index is up 0.3% and Hong Kong’s Hang Seng Index is 0.2% higher. Australia’s All Ordinaries Index is down 0.4% with Australian dollar little changed against the US dollar.

NIKKEI

Brent futures prices are rising today on tensions between Saudi Arabia and Iran, as well as concerns over Venezuelan crude production. Prices fell Monday: May Brent crude settled 0.2% lower at $66.05 a barrel on Monday.

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