(12 February 2020)DAILY MARKET BRIEF 1:US stocks off record on new antitrust investigation on big tech.
US equities renewed record on Tuesday, after the Federal Reserve Chair said he is ‘closely monitoring the emergence of the coronavirus,
which could lead to disruptions in China that spill over to the rest of the global economy’. But the Fed will keep its wait-and-see position as
long as the ‘incoming information about the economy remains broadly consistent with the outlook’.
Despite early gains, the three major US
indices closed near flat on news that the FTC opened new investigations against the big tech companies to examine whether they acquired
small tech firms in a way to harm competition.
Most sectors edged higher in New York. Real estate (+1.22%) and energy stocks led gains
(+1.04%), as technology stocks (-0.34%) lagged. Speaking of antitrust allegations, the big US techs have been accused of altering
competition for many years now, but these allegations had little negative impact on investor appetite.
Equities in Asia traded mixed.
Japanese, Chinese and Korean stocks were mostly up, while sales were dominant in parts of South East Asia. Equities in New Zealand advanced
to a record, as the Reserve Bank of New Zealand (RBNZ) kept its official cash rate unchanged at the historical low of 1.00%.
WTI crude
eased to $49.5 a barrel then rebounded past $50 as investors who lost OPEC’s support found hope in Fed’s accommodative approach to the
coronavirus outbreak and its negative implications on economic growth. Still, WTI is poised to settle durably below the $50 level, as the
demand-side shock will likely increase the global oil glut and continue weighing on oil prices.
By Ipek Ozkardeskaya
