- Global stocks fell Monday after data misses signaled slowing economic growth in the US and China.
- Oil continued to slide, but the dollar stabilized as investors monitored events in Afghanistan.
- Investors are waiting for retail sales data Tuesday and Federal Reserve minutes this week.
- Sign up here for our daily newsletter, 10 Things Before the Opening Bell.
Global stocks slid Monday after disappointing data underscored concerns that a continuing surge in Delta coronavirus variant cases will delay economic recovery.
Concerns about slowing growth in major economies China and the US were weighing on markets. Key Chinese indicators released Monday fell short of forecasts, and the University of Michigan reported a steep drop in its US consumer confidence index Friday.
An update on US retail sales is scheduled for release Tuesday, while minutes from Federal Reserve policymakers' latest meeting are expected Wednesday. Investors are also looking ahead to next week's Jackson Hole meeting, where they expect to get clarification on the Fed's monetary policy plans.
"A weak consumer number tomorrow could well undermine recent optimism in the US recovery story as we look ahead to Q3, and build on the Q2 rebound," Michael Hewson, chief market analyst at CMC markets, said in a note. "Any doubts about the strength of the US recovery, and particularly the US consumer, will only exacerbate concerns about the resilience of the global recovery as a whole."
In China, monthly readings on industrial production, retail sales and investment activity in July came in much weaker than expected, while unemployment rose. Investors are concerned that the Delta variant – whose spread has prompted new local lockdowns as well as partial closures of ports – is having a continued impact on the country's economic growth.
Asian markets had a mixed session, with Hong Kong's Hang Seng index losing 0.88% and the Shanghai Composite climbing 0.03%. Tokyo's Nikkei 225 closed 1.62% lower, as worries about rising COVID-19 cases trumped a better-than-expected reading on second-quarter economic growth.
European markets declined at the open Monday, with Frankfurt's DAX falling 0.71%, London's FTSE 100 slipping 1.22%, and the Euro Stoxx 50 down 0.88%. Investors are bracing for key economic data in Europe this week, including GDP growth, unemployment and inflation.
Oil futures continued their losing streak, under pressure from the jitters about economic recovery. WTI crude was down 1.61%, trading at $67.11 per barrel, while Brent crude was 1.47% lower at $69.55 per barrel.
Meanwhile, investors are monitoring news headlines on the developing situation in Afghanistan, as the Taliban appeared to be taking control after the collapse of the government and the withdrawal of US forces. Most analysts said it was too early to tell what impact the events might have on markets and investor sentiment.
"Geopolitical developments in Afghanistan over the weekend are dominating the world's headlines but it is probably too early to assess what could be the fallout in the FX market," Francesco Pesole, FX strategist at ING said.
The dollar stabilized Monday after losing ground last week. It was up 0.07% at 6:24 am E.T. as the geopolitical tensions rose.