European, US stock markets moderate trading amid interest rate outlook

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European and US stock markets were mixed Friday after gaining earlier in the week over expectations of a series of interest rate cuts later this year.

On Wall Street, the Dow fell as it was pulled lower by Nike, which offered a lackluster outlook.

The wider S&P 500 retreated slightly, while the tech-heavy Nasdaq gained to finish at a record for the third straight day.

Frankfurt rose after a survey showed improved business confidence, while Paris closed lower.

Markets were “catching their breath after an eventful week,” said Charles Schwab analyst Joe Mazzola.

“The market heads into the final week of the first quarter buoyed by optimism over the economy and renewed confidence the Federal Reserve will embark on a rate-cutting cycle later this year,” he said.

London, which has lagged behind most major markets so far this year, was the strongest major market Friday, with the FTSE 100 index closing up 0.6 percent.

It had gained almost two percent Thursday as the Bank of England signaled it could start cutting interest rates over the UK summer.

“The FTSE 100 is benefitting more than the other indices because it was cheap,” said Kathleen Brooks, an analyst at XTB.com.

“This shift in rate cut expectations from the BOE is like a red flag to a bull, and markets have rallied sharply,” she said.

– ‘Some second-guessing’ –
The Swiss National Bank on Thursday became the first major central bank to cut rates aimed at combating soaring inflation, and was followed later in the day by the bank of Mexico.

Equities across the world had surged Thursday in response to the Federal Reserve’s closely watched projections that it would lower borrowing costs three times this year, even after figures showed prices ticking up in January and February.

Apple clawed back some ground Friday after being walloped Thursday when US regulators said they were opening antitrust proceedings against the company for how it limits competition in the iPhone ecosystem.

Nike slumped about seven per cent after offering at tepid near-term outlook, even as it made waves by signing a sponsorship deal with the German national football team, who had been outfitted by Adidas since the 1950s.

Adidas shares were up half a per cent, largely in line with the wider Frankfurt market, which was lifted by a key survey showing that German business morale rose more strongly than expected in March.

The Ifo institute’s closely watched confidence barometer, based on a survey of around 9,000 companies, rose to 87.8 points, from 85.7 in February.

– Key figures around 2050 GMT –
New York – Dow: DOWN 0.8 per cent at 39,475.90 (close)

New York – S&P 500: DOWN 0.1 per cent at 5,234.18 (close)

New York – Nasdaq Composite: UP 0.2 per cent at 16,428.82 (close)

London – FTSE 100: UP 0.6 per cent at 7,930.92 points (close)

Paris – CAC 40: DOWN 0.3 per cent at 8,151.92 (close)

Frankfurt – DAX: UP 0.2 per cent at 18,205.94 (close)

EURO STOXX 50: DOWN 0.4 per cent at 5,031.15 (close)

Tokyo – Nikkei 225: UP 0.2 per cent at 40,888.43 (close)

Hong Kong – Hang Seng Index: DOWN 2.2 per cent at 16,499.47 (close)

Shanghai – Composite: DOWN 1.0 per cent at 3,048.03 (close)

Pound/dollar: DOWN at $1.2601 from $1.2658 on Thursday

Dollar/yen: DOWN at 151.40 yen from 151.62 yen

Euro/dollar: DOWN at $1.0812 from $1.0860

Euro/pound: DOWN at 85.77 pence from 85.79 pence

Brent North Sea Crude: DOWN 0.4 per cent at $85.43 per barrel

West Texas Intermediate: DOWN 0.5 per cent at $80.63 per barrel

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