Global shares hit pause button on inflation, Covid-19 concerns in Asia

Global shares hit the pause button and gold briefly reached a three-month high as surging COVID-19 cases in Asian countries and inflation pressures tempered demand for riskier assets.

Markets have been skittish in recent weeks as bumper supplies of central bank stimulus and rising prices in the United States and other countries fuel concerns some economies could overheat, requiring policymakers to tap on the brakes.

The MSCI World Index, a broad gauge of equity markets globally, was flat in European trade, albeit less than 2% from a recent record high. That followed its best day since February on Friday after an early week inflation-driven selloff.

However, S&P 500 futures and Nasdaq futures were both pointing to a lower open for Wall Street, down 0.4%.

“What markets are doing is hoping for the best and preparing for the worst,” said Fahad Kamal, chief investment officer at Kleinwort Hambros, although adding he felt the inflationary pressures would dissipate.

Equities were also benefiting from the TINA, or “There Is No Alternative” factor, he said.

via Reuters