(Bloomberg) — European shares opened weaker on Tuesday, retreating from recent record highs, as investors retreated to the sidelines ahead of this week’s results from Nvidia Corp.
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The Stoxx 600 index fell 0.2%, with most sectors in the red, while US stock futures were flat. Asian shares also took a breather after seven days of gains. Investors continued to watch commodity prices after the Bloomberg Commodity Spot Index hit its highest level since January 2023, while gold and copper changed hands near all-time highs.
The focus this week will be on Nvidia – the driving force behind the artificial intelligence frenzy of the past year – which has driven much of the S&P 500’s earnings. Shares of Nvidia, which are up more than 90% this year, rose 2.8% in New York on Monday, pushing the Nasdaq 100 index to another record high. Bond yields fell largely because the Federal Reserve and other major central banks are on track to cut rates this year.
“The latest set of growth, inflation and Fed data has given markets the macro support to rise further. Nvidia’s Q1 24 earnings this week could give micro-AI a tailspin,” said Jason Draho of UBS Financial Services Inc. in a note.
Investors will also look for further comments from central bank officials, including Fed Governor Christopher Waller who is scheduled to speak on Tuesday. Bloomberg’s Dollar Spot Index was flat after gains on Monday as Cleveland Fed President Loretta Mester suggested there was less room for rate cuts than previously expected.
Crypto prices rose on signs of momentum toward U.S. approval of exchange-traded funds that invest directly in the second-largest token ether, a shift from a more bleak outlook as recently as last week.
In Asia, China’s economic struggles continue to be in the spotlight, with new data showing little sign of a turnaround in the debt-ridden real estate sector. Local governments last month harvested the least revenue in eight years from land sales, demonstrating the budget pressures facing governments that rely on such revenues for much of their overall income.
Main events this week:
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The Fed’s Thomas Barkin, Christopher Waller, John Williams, Raphael Bostic, Susan Collins and Loretta Mester speak Tuesday
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Sales of existing homes in the US, Wednesday
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Fed minutes, Wednesday
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Nvidia earnings, Wednesday
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Eurozone S&P Global Services PMI, S&P Global Manufacturing PMI, consumer confidence, Thursday
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G-7 financial meeting in Stresa, Italy, May 23-25
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US new home sales, first jobless claims, Thursday
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Raphael Bostic of the Fed will speak on Thursday
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U.S. Durable Goods, University of Michigan Consumer Confidence, Friday
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Fed CEO Christopher Waller will speak on Friday
Some of the major moves in the markets:
Shares
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The Stoxx Europe 600 was down 0.2% as of 8:51 a.m. London time
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Futures on the S&P 500 were little changed
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Nasdaq 100 futures were little changed
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Futures on the Dow Jones Industrial Average were little changed
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The MSCI Asia Pacific Index fell 0.7%
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The MSCI Emerging Markets Index fell 0.7%
Currencies
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The Bloomberg Dollar Spot Index was little changed
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The euro was little changed at $1.0864
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The Japanese yen was little changed at 156.17 per dollar
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The offshore yuan was little changed at 7.2449 per dollar
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The British pound was little changed at $1.2715
Cryptocurrencies
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Bitcoin rose 2.1% to $70,972.74
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Ether rose 4.7% to $3,665.68
Bonds
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The yield on ten-year government bonds fell by one basis point to 4.43%
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The German ten-year yield fell by one basis point to 2.52%
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The British ten-year yield fell by one basis point to 4.16%
Raw materials
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Brent crude fell 0.7% to $83.13 per barrel
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Gold fell 0.3% to $2,418.88 an ounce
This story was produced with the help of Bloomberg Automation.
–With help from Jason Scott, Tania Chen, Catherine Bosley, Aya Wagatsuma, and Joanna Ossinger.
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