Global Stock Markets Fall on Fed Taper Expectation

Global equities slipped to a one-month low on Thursday after a provisional budget deal in Washington prompted speculation the Federal Reserve policymakers will start trimming its stimulus as early as next week.

“The chances of them doing something next week are certainly rising,” said Paul Kavanagh, a partner at Killik.

U.S. data releases were being watched for clues on the strength of the economy, since greater strength means the Fed can act with less risk of curtailing economic growth. Key releases on Thursday included first-time jobless claims for the week ended December 7 and retail sales for November.

This week’s budget pact eased some of the fiscal drag on the U.S. economy and improved the chances the Fed’s will scale back its bond-buying operations at the December 17-18 meeting. The stimulus program has helped equities to hit multi-year highs.

via Reuters

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