By Kit Rees
LONDON (Reuters) – Global equities trod water on Tuesday ahead of a U.S. Federal Reserve policy meeting, while investors reassessed their views of tech stocks following a slump in Facebook’s shares after reports of data misuse.
The MSCI world equity index <.MIWD00000PUS>, which tracks shares in 47 countries, was flat in percentage terms by 0901 GMT, while the pan-European STOXX 600 <.STOXX> equity index slipped 0.1 percent.
Tech <.SX8P> stocks underperformed in Europe as the sector fell 0.3 percent, taking its cue from Monday’s falls for U.S. peers on the back of fears of stiffer regulation as Facebook came under fire following reports it allowed improper access to user data.
Shares in European chipmakers in particular came under pressure, with ams
In the U.S., Facebook
Likewise an accident involving an Uber Technologies Inc
“There certainly are some stocks where valuations look somewhat stretched … so we’re focusing our exposure within the technology sector on the cheaper end of the market,” Mike Bell, global market strategist at JPMorgan Asset Management, said.
“We’re a bit more cautious on the more expensive and some of the more popular names in the sector,” Bell added.
Though tech was a weight, Asian shares recovered to end in positive territory thanks to a rise in health stocks.
The UK’s FTSE 100 <.FTSE> index slightly outperformed the broader European market, up 0.1 percent, as investors cheered a transition deal reached between Britain and the European Union on Monday.
The British pound
However, gains were muted as investors braced for new Federal Reserve Chairman Jerome Powell’s first policy meeting starting later in the day and amid concerns that U.S. President Donald Trump could impose additional protectionist trade measures.
“Investors lightened their positions ahead of the Fed’s policy meeting. The markets are completely split on whether the Fed will project three rate hikes this year or four,” said Hiroaki Mino, senior strategist at Mizuho Securities.
In addition, worries about the potential for a trade war cast a shadow after U.S. President Trump imposed tariffs on steel and aluminum.
The Trump administration is also expected to unveil up to $60 billion in new tariffs on Chinese imports by Friday, targeting technology, telecommunications and intellectual property, two officials briefed on the matter said Monday.
U.S. businesses were alarmed with several large U.S. retail companies, including Wal-Mart Inc
While long-term U.S. bond yields were muted, short-dated yields rose ahead of an expected rate hike from the U.S. Federal Reserve after its two-day policy meeting starting on Tuesday.
The yield on 10-year Treasuries was little changed at 2.857 percent
But the yield on two-year notes
Still, with a Fed rate rise already fully priced in, the dollar barely gained from the prospect of a rate hike.
The yen was little changed at 106.37 per dollar
Oil prices edged slightly higher as investors remained wary of growing crude supply although tensions between Saudi Arabia and Iran provided some support.
Brent crude futures
(Reporting by Kit Rees and Hideyuki Sano in Tokyo; Editing by Matthew Mpoke Bigg)