Global stocks set to reach three-month low after turbulent February but USD jumps to five-week high

Global equities are on track to end February down 3.5%, their first monthly loss since October 2016. That`s the reaction of markets to U.S. Federal Reserve chair Jerome Powell, who said on Tuesday that recent data had strengthened his confidence on inflation, prompting traders to raise bets that the Fed will squeeze in a fourth rate hike this year.

U.S. stocks suffered their biggest daily drops since a selloff three weeks ago, with the Dow Jones industrial average falling nearly 1.2%, or about 300 point

In Europe, nearly all the continent’s major bourses traded in negative territory in mid-morning trade. The Stoxx Europe 600 index, the region’s broadest measure of share prices, fell around 0.4%, with most sectors in the red. Germany’s DAX performance index slipped 0.18% by mid-day in Frankfurt while Britain’s FTSE 100 was marked 0.38% lower in London.

World stocks were also set to snap a record 15-month winning streak due to data signaling a slowdown in China’s manufacturing and Japan’s industrial output.

Sentiment toward the mining sector and China’s stocks took a knock after the country’s official gauge of manufacturing managers’ growth expectations came in at a 20-month low, falling to 50.3 in February — down a full point from January and its largest fall in more than six years.

European mining stocks are also lower after the Chinese data, with the Stoxx mining stocks down 1.5%.

Dollar jumps to five-week high, though. U.S. dollar rose to its strongest level in more than five weeks, boosted by bets that the Fed could increase interest rates as many as four times this year.

Sources:

https://www.ft.com/content/a67bd056-1c24-11e8-956a-43db76e69936

https://www.investing.com/news/stock-market-news/wall-street-on-course-for-february-loss-first-in-10-months-1316607

https://www.thestreet.com/story/14503821/1/global-stocks-extend-declines-as-investors-cast-hawkish-hue-on-powell-testimony.html

https://www.thestar.com.my/business/business-news/2018/02/28/global-stocks-slip-yields-rise-on-fed-chiefs-testimony/

http://www.euronews.com/2018/02/28/global-funds-cut-stocks-to-three-month-low-after-turbulent-february-reuters-poll

https://www.bnn.ca/fed-s-powell-sends-global-stocks-reeling-to-five-day-low-1.1013431

https://www.wsj.com/articles/global-stock-markets-continue-advance-1519691701

http://www.livetradingnews.com/morning-briefing-global-stocks-178-75934.html#.Wpa29lWWaCg

https://www.investing.com/news/economy-news/top-5-things-to-know-in-the-market-on-wednesday-1316211