Central banks, Brussels meetings hit stocks

IRJ Mar 15 - Concerns about monetary tightening in China and caution ahead of U.S. and Japanese central bank policy meetings this week weighed on financial markets on Monday, weakening stocks. The euro, meanwhile, slipped on concerns that a potential financial aid package for Greece, being discussed by finance ministers in Brussels, would not be enough to solve the euro zone's sovereign debt crisis. MSCI's all-country world index .MIWD00000PUS was off 0.3 percent, with the pan-European FTSEurofirst 300 .FTEU3 down the same and Japan's Nikkei closing up just 0.01 percent .N225. Wall Street looked set to open lower. "We have had quite a lot of macro uncertainties out there," said Jeremy Batstone-Carr, head of private client research at Charles Stanley in London. "The equity markets have had a high degree of complacency regarding these concerns." The U.S. Federal Reserve and Bank of Japan both meet in the coming week and will be keenly watched for their views on how attempts to ignite economic growth have fared. Wednesday's Fed meeting is expected to hold interest rates near zero and reiterate the need for an "extended period" of "exceptionally low" rates. The Bank of Japan, meanwhile, is under pressure to loosen policy at its meeting on Tuesday and Wednesday, most likely in the form of increasing funds offered under its lending operation. China, in the meantime, is causing some investors concern because of both its rising inflation and its insistence that the yuan currency is not undervalued, a bone of contention with the United States. On again, off again reports of European Union help for debt-burdened Greece were also putting some investors on edge.

Add to: del.icio.us | Digg | NewsVine | Mixx | FaceBook | Twitter