Global shares mostly decline ahead of key reports from the US

Economists expect the jobs report from November, due Tuesday, to show employers added 40,000 more jobs than they cut during the month. An update on inflation on Thursday is forecast to show US consumers paid prices that were 3.1 per cent higher in November than a year before

Bangkok: Shares retreated on Tuesday in Europe and Asia ahead of the release of US employment and inflation reports that could drive the direction of interest rates.

The future for the S&P 500 fell 0.5 per cent, and that for the Dow Jones Industrial Average was 0.3 per cent lower. Germany’s DAX lost 0.4 per cent to 24,142.20, while the CAC 40 in Paris edged 0.1 per cent higher, to 8,129.43. Britain’s FTSE 100 slipped 0.3 per cent to 9,722.23. In Asian trading, Tokyo’s Nikkei 225 declined 1.6 per cent to 49,383.29 as preliminary factory data showed manufacturing slowing slightly.

The S&P Global Flash purchasing managers index rose to 49.7 from 48.7 in November on a scale of up to 100, where 50 marks the cutoff for expansion. Investors are watching Japanese data carefully ahead of a Bank of Japan policy meeting on Friday that is widely expected to result in an interest rate hike that could rattle world bond, currency and cryptocurrency markets.

Chinese markets also retreated after figures for November, released Monday, came in weaker than expected. Retail sales rose at their slowest rate since 2022, during the pandemic, at 1.3 per cent from a year earlier in November.

Lending and investment also weakened. “Overall, the data set confirms a loss of momentum into (the) year-end and is consistent with our growth forecasts that moderate to around 4 per cent” in the last quarter of this year, Tan Boon Heng of Mizuho Bank said in a report. Hong Kong’s Hang Seng dropped 1.5 per cent to 25,235.41, while the Shanghai Composite index lost 1.1 per cent to 3,824.81. South Korea’s Kospi gave up 2.2 per cent to 3,999.13 as technology shares dropped.

Computer chip maker SK Hynix skidded 4.3 per cent, while Samsung Electronics fell 1.9 per cent. In Taiwan, the Taiex shed 1.2 per cent. Australia’s S&P/ASX 200 declined 0.4 per cent to 8,598.90. Shares in Roomba maker iRobot sank 22 per cent in premarket trading after the company filed for Chapter 11 bankruptcy protection. That was on top of a nearly 73 per cent decline on Monday.

The company, known for its robotic vacuums, has struggled with increased competition but said it doesn’t expect any disruptions to its devices as it is taken private under a restructuring process. On Monday, the S&P 500 slipped 0.2 per cent, though the majority of stocks within the index rose. The Dow Jones Industrial Average dipped 0.1 per cent, and the Nasdaq composite fell 0.6 per cent.

Artificial-intelligence -related stocks, which were mixed following last week’s swings, helped keep gains in check. NVIDIA, the chip company that’s become the face of the AI boom, added 0.7 per cent. But Oracle sank another 2.7 per cent following its 12.7 per cent tumble last week, its worst in more than seven years.

Broadcom fell 5.6 per cent. AI stocks have wobbled on worries that the billions of dollars flowing into chips and data centres may not yield a big enough payoff.

The main focus on Wall Street this week, apart from AI, will be several big updates on the US economy. Economists expect the jobs report from November, due Tuesday, to show employers added 40,000 more jobs than they cut during the month. An update on inflation on Thursday is forecast to show US consumers paid prices that were 3.1 per cent higher in November than a year before. Investors are hoping that the job market will weaken by just enough to get the Federal Reserve to lower interest rates, but not so much that the economy slips into recession. Lower rates help boost the economy and prices for investments, but also may worsen inflation. Economists expect Tuesday’s report to show the unemployment rate at 4.4 per cent, which would keep it near its worst level since 2021. In other dealings early Tuesday, US benchmark crude oil lost USD 1.08 to USD 55.74 per barrel. Brent crude, the international standard, fell USD 1.06 to USD 59.50 per barrel. The US dollar fell to 154.84 Japanese yen from 155.21 yen. The euro rose to USD 1.1760 from USD 1.1755.