London Shares Set to Fall at the Open
Contracts on the FTSE 100 futures traded in the redon Thursday, following its Asian and European peers lower, as investors continue to worry over rising inflationary pressures and fear central banks would tighten monetary policy soon. On the corporate front, Burberry sales jumped in line with its previous forecast in Q1. Earnings from BT Group and Greggs will also be in the spotlight.
Bitcoin Rebounds after Tesla Rejection
Bitcoin rebounded to about $51,000 on Thursday after tumbling 15% the day before as Elon Musk tweeted “Tesla has suspended vehicle purchases using Bitcoin. We are concerned about rapidly increasing use of fossil fuels for Bitcoin mining and transactions, specially coal, which has the worst emissions of any fuel”. The move comes less than 2 months after the company began accepting Bitcoin for payments. Other cryptocurrencies, including ethereum, also fell before regaining some ground. Still, Bitcoin market capitalization had dropped to around $2.06 trillion after the Tesla’s announcement, wiping off around $365.85 billion, CNBC reported.
South Korean Shares Fall for 3rd Session
The KOSPI lost 39.55 points or 1.25% to 3122.11 on Thursday, extending declines for the 3rd consecutive session and falling further from record highs touched earlier in the week as market participants remain cautious on concerns of rising inflation. The US annual inflation rate jumped to 4.2%, the highest in 13 years and well above forecasts of 3.6%, while the monthly gauge rose 0.8%, the most since 2009, and the monthly core inflation increased to 0.9%, the highest since 1996. Local 10-year bond yields hit near 3-year highs of 2.196% while US 10-year rates were at monthly highs of 1.678%. On the coronavirus front, the KDCA reported 715 more COVID-19 cases as the country’s inoculation drive showed little progress recently due to tight supply of vaccines. Earlier in the week, South Korea’s unemployment rate fell to 3.7% in April, the lowest jobless rate since August 2020.
European Futures in the Red
European futures were lower on Thursday, tracking a general negative sentiment in the Asia-Pacific region, and following a big plunge on Wall Street the day before after US inflation jumped to a 13-year high. Investors remain very concerned that soaring commodity prices and supply constraints could pressure inflation, leading central banks, specially the Fed, to raise interest rates sooner rather than later. On the corporate front, Telefonica earnings were broadly in line with forecasts.