Global stocks fall as markets still rattled by Fed minutes

Asian and European share markets fell on Thursday, after the U.S. Federal Reserve’s latest meeting minutes highlighted doubts about the recovery of the world’s largest economy and knocked Wall Street from recent record highs.

MSCI’s broadest index of Asia-Pacific shares outside Japan had its biggest daily decline in five weeks while the MSCI world equity index, which tracks shares in 49 countries, was down 0.6% at 0738 GMT. The pan-European STOXX 600 was down 0.9% and London’s FTSE 100 fell 0.8%.

The Fed’s minutes from its July meeting, which were released on Wednesday, highlighted doubts about the U.S. economic recovery, showing that the swift labour market rebound seen in May and June had likely slowed.

Several Fed policymakers said they may need to ease monetary policy to help get the economy through the coronavirus pandemic.

Despite the dovish minutes, U.S. Treasury yields and the dollar rose with investors focusing on parts of the minutes that showed policymakers downplaying the need for yield caps and targets. The dollar index, which measures the currency against a basket of major peers, was choppy overnight.

Spot gold rebounded overnight, after declining to a near one-week low on Wednesday, when markets were more bullish. It was up 0.6% , at $1,940.4478 per ounce.

Oil prices fell, as major producers warned of a risk to demand recovery. OPEC and its allies pressed oil nations that are pumping above output targets to cut more in August to September. Brent crude was down 32 cents, or 0.7%, at $45.05 a barrel while U.S. oil was down 38 cents, or 0.9%, at $42.55 a barrel.

Global stocks fall as markets still rattled by Fed minutes, Reuters, Aug 20