The Friday Market Minute
- Global stocks traded lower Friday following weakening inflation data from China and the biggest decline in U.S. retail sales since 2009.
- Slowing data from the world's two biggest economies added pressure to U.S.-China trade talks, which wrapped up Friday in Beijing with Treasury Secretary Steve Mnuchin citing "productive" meetings with Vice Premier Liu He.
- European stocks stocks slip lower, but losses are held in check as the euro remains wedded to a multi-month low amid concerns over regional growth prospects and further monetary loosening from the European Central Bank.
- Global oil prices rise for a fourth session as reports suggest a key Saudi oil filed was shut down this week as the Kingdom signals deeper output cuts to balance world markets.
- U.S. equity futures suggest another day of declines on Wall Street ahead of earnings from Deere & Co., Pepsi, Moody's and Newell Brands.
Global stocks traded lower Friday as investors worried that weakening data from the world's two biggest economies could signal a deeper growth slowdown while eyeing the market impact of President Donald Trump's decision to declare a national emergency after failing to win border wall funding from U.S. lawmakers.
A twin set of inflation data from China underscored both export and domestic demand weakness in the world's second largest economy Friday, with factory gate inflation slowing for the seventh consecutive month in January -- to a 2016 low -- and consumer prices rising at the weakest pace in a year. The figures, published by the National Bureau of Statistics, suggest China will struggle to reverse last year's broader economic slowdown, which was the worst in a decade.
The weakness in China followed data from the United States Thursday that indicated the biggest fall in December retail sales since 2009, a surprise reading that triggered significant markdowns in U.S. economic growth forecasts and pushed Wall Street to its biggest decline in a week.
The figures also added further pressure to U.S.-China trade talks, which concluded today at the Diaoyutai state guest house near Beijing. U.S. Treasury Secretary Steve Mnuchin said the negotiations had been "productive", but markets remain concerned that significant progress might not be made prior to the March 2 deadline, which White House Economic Adviser Larry Kudlow said Thursday would remain in place.
Early indications from U.S. equity futures suggest another day of red on Wall Street Friday, with contracts tied to the Dow Jones Industrial Average I:DJI indicated a 150 point decline and those linked to the S&P 500 undefined are guiding to an 11.7 point pullback for the broader benchmark.
Senate Majority Leader Mitch McConnell told lawmakers Thursday that President Trump President Trump will declare a national emergency to free up funds to construct a border wall with Mexico, but will sign funding legislation that would avoid another government shutdown.
Overnight in Asia, a modestly weaker U.S. dollar boosted regional currencies and clipped gains for regional benchmarks, pushing the MSCI Asia ex-Japan index 1.18% lower from its recent four-month highs while the Nikkei 225 in Tokyo closed 1.13% lower at 20,90.63 points.
European stocks were also weaker at the start of trading Friday, although a weaker euro kept the early losses in check as it held at a multi-month low of 1.1275 against the U.S. dollar.
The Stoxx 600 was marked 0.05% lower in Frankfurt while Britain' FTSE 100 drifted 0.13% in the opening minutes of trading in London.
Global oil prices bucked the broader market trend by extending gains for a fourth consecutive session Friday amid reports of the shutdown of Saudi Arabia's key Safaniyah oil field, which produces around 1 million barrels per day, which could be linked to the Kingdom's signals on slowing output to support the OPEC+ cartel's broader production cuts.
Brent crude contracts for April delivery, the global benchmark, were marked 30 cents higher from their Thursday close in New York and changing hands at $64.82 per barrel, the highest since November 21 and a move that extends gains from the December 24 trough past 25%.
WTI contracts for March delivery were seen 14 cents higher at $54.55 per barrel, the highest since February 4.