World equities drift on eve of Fed rate call
London, United Kingdom: Global stock markets drifted Tuesday on the eve of a key monetary policy update from the US Federal Reserve and ahead of earnings results from tech giants.
While trading floors are geared up for a rocket-fuelled surge in economic activity in the second half of the year and into the next, thanks to coronavirus vaccinations and the easing of lockdowns, traders are in wait-and-see mode.
The Fed's monetary policy meeting outcome on Wednesday is broadly expected to see it reassert its pledge to maintain the ultra-loose policy until its goals on unemployment and inflation are met.
The Fed's accompanying statement will be closely examined for clues on the state of the coronavirus-ravaged US economy and the future path for borrowing costs.
The central bank's meetings are a crucial focus of investor interest as they continue to fret that the expected strong recovery will send prices soaring and force policymakers to raise the record low-interest rates cementing a global rally.
US President Joe Biden, meanwhile, will make his first State of the Union address on Wednesday, in which he could unveil a $1.8-trillion American Families Plan that would provide national child care, paid family leaves, and free community college paid for with higher taxes on the rich.
After Monday saw record-high closes, Wall Street was barely creeping into the red two hours into trading.
"Hovering near-record territory, US stocks are struggling for a big move as roughly three out of four companies have delivered strong earnings results and as financial markets are confident that the Fed will stay put and refrain on giving any clues on when they will taper asset purchases," said Oanda senior market analyst Edward Moya.
Apple was off 0.15 percent as EU competition authorities were expected to file formal accusations against the US company for unfairly squeezing out music streaming rivals, according to sources close to the case.
Separately, Russian regulators slapped a $12.1 million fine on Apple for "abusing" its dominant position in the market by giving preference to its own applications.
Tesla was down 3 percent despite reporting record profits on a huge jump in revenues. Some analysts focused on the significant revenues tied to government credits to buy electric cars.
"The biggest disappointment was the lack of guidance on full-year deliveries. This is the number that the market focuses on, and silence speaks volumes," commented Oanda market analyst Sophie Griffiths.
Shortly after the US opening, there was a glimmer of cheer after a key survey showed US consumer confidence hitting a post-pandemic high.
Earlier, most Asian markets had swung in and out of positive territory with Tokyo, Hong Kong, Sydney, Seoul, Jakarta, and Manila all in the red.
Major European markets all limited losses, London off 0.3 percent -- aeronautics manufacturer Rolls Royce shed 4.5 percent -- while Frankfurt and Paris also slipped into the red.
Google's owner Alphabet and Microsoft were to publish first-quarter results on Tuesday while Apple, Amazon, and Facebook will release their figures later this week.
Elsewhere, oil prices rose before Wednesday's key output meeting of OPEC and other major crude producers, and in a sign economic recovery may be around the corner the price of copper hit a decade-high close to $10,000 a tonne, largely on strong Chinese demand and tight supplies of the metal used in popular electric wiring amid strike action in the world's biggest producer Chile.
The price has more than doubled since dropping to $4,371 a tonne in March last year as the coronavirus pandemic took hold around the world.
Key figures around 16:00 GMT
New York - Dow: DOWN 0.1 percent at 33,973.54
London - FTSE 100: DOWN 0.3 percent at 6,944.97 points (close)
Frankfurt - DAX 30: DOWN 0.4 percent at 15,249.27 (close)
Paris - CAC 40: DOWN 0.2 percent at 6,273.76 (close)
EURO STOXX 50: DOWN 0.4 percent at 4,007.12
Tokyo - Nikkei 225: DOWN 0.5 percent at 28,991.89 (close)
Hong Kong - Hang Seng Index: FLAT at 28,941.54 (close)
Shanghai - Composite: FLAT at 3,442.61 (close)
Euro/dollar: DOWN at $1.2078 from $1.2086
Pound/dollar: UP at $1.3913 from $1.3899
Euro/pound: DOWN at 86.82 pence from 86.96 pence
Dollar/yen: UP at 108.3 yen from 108.08 yen
Brent North Sea crude: UP 0.3 percent at $65.82 per barrel
West Texas Intermediate: UP 0.8 percent at $62.31 per barrel