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Markets Wrap: Stocks Weaken, Dollar Continues Rally on Fed Outlook

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European Stocks Head for Longest Run of Losses in Over Five Years

(Bloomberg) — European stocks are on track for their longest run of losses in more than five years. This comes after weak German economic data and a strengthening dollar as investors anticipate further Federal Reserve policy tightening.

German Economic Data Causes Retreat in European Stocks

  • The Stoxx 600 gauge is retreating for a seventh consecutive day.
  • German industrial output declined again in July, further impacting Europe’s largest economy.

Dollar Strengthens with Eighth Consecutive Week of Gains

  • The Bloomberg dollar index is set for its longest ever run of increases.
  • This streak of gains dates back to 2005.

Risk-off Sentiment Intensifies with China’s Plan to Ban iPhones

  • US equity futures face downward pressure as China plans to ban iPhones from certain government departments and state-backed agencies.
  • This poses a blow to Apple Inc.

Treasury Yields Increase Following Positive US Services Index

  • Treasury yields are drifting higher, extending Wednesday’s increases.
  • Data from the Institute for Supply Management’s US services index shows growth in August.
  • Economists have been boosting their forecasts for US gross domestic product.

Fed Officials May Scale Back Rate Cut Estimates

  • Strong economic reports prompt economists to revise their GDP forecasts for the US.
  • Traders have reduced bets on the degree of Fed easing they expect next year.

Risk-off Sentiment Spills into Asian Markets

  • All major Asian markets experience declines.
  • Chinese stocks, particularly property developers, are among the worst performers.

Commodities Experience Mixed Results

  • Oil declines, snapping a nine-day winning streak.
  • Gold edges higher after a drop on Wednesday.

Upcoming Key Events

  • China forex reserves
  • Eurozone GDP
  • US initial jobless claims
  • Bank of Canada Governor Tiff Macklem to speak on the Economic Progress Report
  • Atlanta Fed President Raphael Bostic speaks
  • New York Fed President John Williams participates in moderated discussion at the Bloomberg Market Forum
  • Japan GDP
  • Germany CPI
  • US wholesale inventories and consumer credit

Main Market Moves


  • The Stoxx Europe 600 fell 0.4%
  • S&P 500 futures fell 0.3%
  • Nasdaq 100 futures fell 0.5%
  • Futures on the Dow Jones Industrial Average fell 0.2%
  • The MSCI Asia Pacific Index fell 0.7%
  • The MSCI Emerging Markets Index fell 0.7%


  • The Bloomberg Dollar Spot Index rose 0.1%
  • The euro fell 0.2% to $1.0710
  • The Japanese yen rose 0.1% to 147.46 per dollar
  • The offshore yuan fell 0.2% to 7.3328 per dollar
  • The British pound fell 0.3% to $1.2473


  • Bitcoin rose 0.3% to $25,745.36
  • Ether rose 0.5% to $1,635.96


  • The yield on 10-year Treasuries was little changed at 4.28%
  • Germany’s 10-year yield was little changed at 2.65%
  • Britain’s 10-year yield declined two basis points to 4.51%


  • Brent crude fell 0.3% to $90.34 a barrel
  • Spot gold rose 0.1% to $1,918.51 an ounce

This story was produced with the assistance of Bloomberg Automation.

©2023 Bloomberg L.P.

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