European and US stocks declined yesterday and the futures hint at a bearish start in Europe.
Inflation and recession fears take the upper hand, after the European Central Bank (ECB) raised its inflation significantly from 5.1% to 6.8% for this year, and cut the growth forecast, significantly as well, for this year and the next. But the rates remained unchanged, and Lagarde called for a 25-bp hike in July.
As such, the ECB decision revived inflation and recession fears, but hardly the euro bulls.
Due today, the US inflation data will be the major focus before the weekly closing bell. Investors are tense on the idea that we could see an ugly surprise, as energy prices keep rising and there has been an unexpected tick in used car prices in May.
Elsewhere, crude oil eases, but natural gas prices tick higher on a fire at Texas LNG facility. Alibaba lost 8% as Chinese regulators denied news that they would revive the much-expected ANT Group IPO.
Bitcoin remains stuck near the $30K level.
Source: Ipek Ozkardeskaya – Swissquote Bank Ltd
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