Stocks edge lower on China data; gold hits above $2,000

BLOOMBERG

Stocks fell and gold climbed to a six-month high as data showed a sharp slowdown in China’s industrial profits, which reinforced investor concerns about its sluggish economy.
The Stoxx 600 index fell 0.3% and Nasdaq futures retreated 0.2%. Treasury 10-year yields climbed as much as five basis points to 4.51%, the highest in more than a week. Gold climbed to the highest since May, while the dollar was little changed. A slowdown in China’s industrial profit growth added to concern about deflation in the world’s second-largest economy. Fresh economic data this week will help traders gauge whether the gains for stocks and bonds seen so far this month can extend into December. Statistics include euro-zone inflation figures, China PMIs and US personal consumption numbers on Thursday, and US and euro-area PMIs on Friday.
“There’s not much fundamental reason for high market optimism,” said Ulrich Leuchtmann, head of currency strategy at Commerzbank AG. The cautious start comes despite the VIX index, known as Wall Street’s “fear gauge,” falling to its lowest level since January 2020.
Markets have been buoyed by a growing assumption that further interest-rate hikes from the Federal Reserve and European Central Bank are unlikely.
In earnings due this week, Crowdstrike Holdings Inc will underscore how businesses are prioritising cybersecurity after recent high-profile corporate hacks, while Salesforce
Inc and Dell Technologies Inc are expected to post slower sales growth as overall corporate expenditure tightens. Gold closed above $2,000 an ounce, capping a second weekly gain and bolstering confidence that higher prices are justified.