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The revelation that the FBI has opened a new investigation into U.S. presidential candidate Hillary Clinton’s private email server weighed on global stock markets on Monday, a little more than a week from election day. Investors around the world also have a raft of potentially market-moving data and events to monitor this week, culminating with Friday’s U.S. non-farm payrolls report for October.
KEEPING SCORE: In Europe, France’s CAC 40 was down 0.7 percent to 4,517 while Germany’s DAX slipping 0.3 percent to 10,667. Britain’s FTSE 100 lost 0.4 percent to 6,967. U.S. indexes were poised for a flat opening, with Dow futures and the broader S&P 500 futures unchanged.
US VOTE: FBI Director James Comey dropped a bombshell Friday when he said the agency would review new emails that might be connected to the dormant investigation of Clinton’s email practices. In response, the top Senate Democrat, Harry Reid, blasted the director for making the announcement just 11 days before the U.S. election, saying he effectively favored one party over another. Democrats fear Republican candidate, Donald Trump, will gain fresh momentum from the discovery as the Nov. 8 vote nears.
QUOTEWORTHY: “From the perspective of the financial markets, a win for Clinton is the preferred outcome as it is seen as ‘business as usual’ from a policy perspective and investors would see little reason to believe that the underlying trends in the economy or the direction of monetary and fiscal policy would materially change,” said Neil MacKinnon, global macro strategist at VTB Capital.
NOT JUST ELECTION: As well as monitoring the fallout from the FBI investigation, investors have a lot of economic news to digest right up to Friday’s jobs data. One particular point of interest will be the culmination of the Federal Reserve’s two-day meeting. No policy change is anticipated but the Fed is expected to signal its intent to raise interest rates in December.
EUROPE MUTED: The focus won’t just be on the U.S. On Monday, figures showed that the 19-countrry eurozone economy grew by 0.3 percent in the July to September period, unchanged from the previous quarter, while inflation edged up to 0.5 percent in the year to October from 0.4 percent the previous month. Both rates are fairly low and are likely to encourage the European Central Bank to enact further stimulus measures later this year.
JAPAN DATA: Industrial output and retail sales were weaker than anticipated, according to figures released Monday. Retail sales were flat in September compared with August but fell nearly 2 percent from a year earlier, reflecting weak household spending. Analysts are divided over whether the latest data might prompt the Bank of Japan to whittle the benchmark policy interest rate, now at minus 0.1 percent, still lower at a meeting Tuesday.
CURRENCIES: The divergence in interest rate policies helps explain the dollar’s resilience in the face of political uncertainty. The euro fell 0.3 percent to $1.0949 while the dollar rose 0.3 percent to 105 yen.
ASIA’S DAY: Japan’s benchmark Nikkei 225 index lost 0.1 percent to close at 17,425.02 and South Korea’s Kospi fell 0.6 percent to 2,008.19. Hong Kong’s Hang Seng gave up its gains to end 0.1 percent lower at 22,934.54 while the Shanghai Composite Index in mainland China fell 0.1 percent to 3,100.49. Australia’s S&P/ASX 200 added 0.6 percent to 5,317.70.
ENERGY: U.S. benchmark oil futures extended losses after falling last week to their lowest price this October. Crude slipped 29 cents to $48.41 a barrel in electronic trading on the New York Mercantile Exchange. Brent crude, the international standard, lost 36 cents to $49.35 a barrel in London.