Dow Jones:Global stocks fell Friday as Thursday’s steep drop in commodities prices weighed on energy companies.
The Stoxx Europe 600 was down 0.5% in early trade, deepening losses from the previous session after a tumble in oil prices sent U.S. indexes plummeting to their worst daily decline in a month.
Brent crude oil prices snapped back to trade 0.9% higher at $45.42 a barrel Friday, after a sharp fall the day before driven by the release of U.S. data which added to concerns about oversupply.
Thursday’s fall in commodities prices, including copper and nickel, weighed on Asian bourses, with Australia’s S&P/ASX 200, which heavily depends on commodity exports, down 1.5%, Hong Kong’s Hang Seng down 2.1% and Shanghai’s Composite Index down 1.4%.
Meanwhile, speeches from U.S. Federal Reserve officials Thursday offered little clarity on the central bank’s plans for interest rates, but investors are betting it will act next month.
Global stocks have been exposed to swings in recent sessions, as investors gauge the implications of a first increase in U.S. rates in nearly a decade. Loose monetary policy has boosted equities in recent years. Fed officials have suggested the decision to increase rates could come as early as December.
“Equity markets are pulling back, and the critical question will be if a rate increase by the Fed will be digested smoothly and not lead to deflationary fears,” said Gerhard Schwarz, head of equity strategy at Baader Bank.
Still, Mr. Schwarz believes the outlook for European equity markets is reasonably positive into the next year.
In currencies, the euro fell 0.3% against the dollar to trade at 1.0768, after data showed the German economy slowed in the third quarter, even though its French counterpart returned to growth. The dollar was 0.1% higher against the yen at 122.71
On the metals markets, meanwhile, gold was up 0.1% at $1082.30 an ounce after nearing a 5 1/2 -year low.
Later Friday, investors will eye key economic snapshots including growth figures for the eurozone as a whole and U.S. retail sales as investors head into the holiday shopping season.