Global stocks mixed as traders track eurozone data, await Fed

Investors in the United States are tracking signals on interest rates from the Federal Reserve (SAUL LOEB)
Investors in the United States are tracking signals on interest rates from the Federal Reserve (SAUL LOEB)

Global stocks were mixed Tuesday as Wall Street wavered ahead of fresh interest-rate signals from the US Federal Reserve, and new data showed that the eurozone dodged recession at the end of last year.

On Wall Street, the Dow Jones Industrial Average rose 0.4 percent, while the broad-based S&P 500 and the Nasdaq Composite both fell.

Earlier in the day, data showed that consumer confidence rose in January to its highest level for more than two years, while inflation expectations fell.

"I think that if inflation keeps falling and if the economic activity is still strong, this is an ideal economy for the Fed," Cresset Capital chief investment officer Jack Ablin told AFP.

"This gives the Fed a lot of elbow room."

Among individual stocks, package delivery company UPS saw its share price plunge 8.2 percent after announcing 12,000 job cuts.

And the share price of auto giant General Motors rose 7.8 percent after it beat profit targets and announced changes to its lineup to include plug-in hybrid electric vehicles.

Tech giants Microsoft and Google both saw their share price slip in after-hours trading after publishing their earnings results for the fourth quarter.

- Eurozone avoids recession -

Stocks in Europe closed higher after official figures showed that the eurozone economy avoided a technical recession in the second half of 2023.

While it stagnated in the final three months of the year, it was better than forecast by analysts who had expected a small contraction.

The French economy stagnated at the end of the year but Spain, Italy and Portugal posted growth over the same period.

"We are seeing markets react to a rather surprising raft of eurozone growth data that has seen stronger-than-expected Spanish, Italian, and eurozone GDP for the fourth quarter," said Joshua Mahony, chief market analyst at Scope Markets.

The single-currency area's economy has been buffeted by higher interest rates, a cost-of-living crisis hitting household spending and weakening global demand.

- Markets await Fed decision -

The US Fed is almost certain to keep its key lending rate on hold Wednesday for a fourth straight meeting, as it continues its fight to return inflation to its long-run goal of two percent.

"Investors expect the Fed to cut the rates from May and the dollar to lose value this year," said Ipek Ozkardeskaya, senior analyst at Swissquote bank.

"Yet the Fed's path to rate cuts may not be as swift as many believe, if inflation numbers start looking bad again."

In Asia, Hong Kong and Shanghai indices fell heavily as an order to liquidate indebted property developer Evergrande fanned fears about China's fragile economy.

Oil prices rose after Saudi Arabia ordered its energy giant Aramco to maintain its oil production capacity at 12 million barrels per day, abandoning a planned increase.

- Key figures around 2115 GMT -

New York - Dow: UP 0.4 percent at 38,467.31 points (close)

New York - S&P 500: DOWN 0.1 percent at 4,924.97 (close)

New York - Nasdaq Composite: DOWN 0.8 percent at 15,509.90 (close)

London - FTSE 100: UP 0.4 percent at 7,666.31 (close)

Paris - CAC 40: UP 0.5 percent at 7,677.47 (close)

Frankfurt - DAX: UP 0.2 percent at 16,972.34 (close)

EURO STOXX 50: UP 0.5 percent at 4,662.70 (close)

Tokyo - Nikkei 225: UP 0.1 percent at 36,065.86 (close)

Hong Kong - Hang Seng Index: DOWN 2.3 percent at 15,703.45 (close)

Shanghai - Composite: DOWN 1.8 percent at 2,830.53 (close)

Euro/dollar: UP at $1.0850 from $1.0838 on Monday

Euro/pound: UP at 85.41 pence from 85.24 pence

Pound/dollar: DOWN at $1.2699 from $1.2710

Dollar/yen: UP at 147.59 yen from 147.48 yen

West Texas Intermediate: UP 1.4 percent at $77.82 per barrel

Brent North Sea Crude: UP 0.4 percent at $82.87 per barrel