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Indian stocks slip after Trump's visa executive order
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Dollar steady as traders look for monetary policy cues
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BOJ hawkish hold keeps rate hike chances alive
(Updates with European open, adds quote in paragraph 14)
By Nell Mackenzie and Ankur Banerjee
LONDON/SINGAPORE, Sept 22 (Reuters) - European markets
ticked lower on Monday, dragged by automakers' profit warnings,
while the dollar steadied as markets waited to see if optimism
over the Federal Reserve's easing monetary policy might be
offset by geopolitical concerns.
The pan-European STOXX 600 was little changed, with
Spanish and German stocks down 0.6% and 0.5%,
respectively.
Luxury carmaker Porsche its parent Volkswagen
both cut their profit forecasts after delaying the
rollout of EV models due to weak demand.
Meanwhile, MSCI's broadest index of world stocks
was little changed while India's benchmark index
slipped 0.2% after the Trump administration
said it would ask companies to pay $100,000 for new H-1B worker
visas, a blow to the tech sector that relies on skilled workers
from India and China.
In China, stocks were choppy even as U.S. President Donald
Trump said he and Chinese President Xi Jinping had made progress
on a TikTok agreement.
The Shanghai Composite index .SSEC was up 0.2% while the
blue-chip CSI300 index also rose 0.5%.
India's $283 billion information technology sector, which
gets more than half its revenue from the U.S., will likely feel
the pain in the near term.
Trump last month doubled tariffs on imports from India to as
much as 50%, partly due to New Delhi's purchases of Russian oil.
"It's a risk to operating costs and margins first of all.
Obviously it could raise wages and labour costs a bit," said
Kyle Rodda, senior financial analyst at Capital.com
"Tech companies may also find themselves in a bind where
they confront punitive measures if they look to offshore labour
because they can't find enough workers in the U.S."
FED POLICY OUTLOOK
On the macroeconomic front, investors remain keen to gauge
the U.S. monetary policy path after the Fed indicated a gradual
easing phase in the future, with traders pricing in 44 basis
points of easing in the two policy meetings left for the year.
A host of policymakers is expected to speak in the week
including John Williams, Thomas Barkin and Stephen Miran on
Monday, and Raphael Bostic and Michelle Bowman on Tuesday along
with Fed Chair Jerome Powell.
"Now it's time for central bankers to come out and explain
everything," said James Rossiter, head of global macro strategy
at TD Securities, who hoped that over the next two days these
remarks will help markets shape expectations more precisely.
Data on the Fed's preferred gauge of inflation is due on
Friday that will also help set the tone for the near-term rate
outlook.
The expectation is for the core PCE price index to rise by
0.2% on a monthly basis, which would keep the annual rate steady
at 2.9%, the same as in July, and above the 2.6% low it reached
in April, according to Tony Sycamore, market analyst at IG.
"Although even a shallower rate-cutting cycle should, in
theory, weigh on the U.S. dollar, the U.S. dollar short trade
has become crowded," Sycamore said, adding the dollar index has
lost downside momentum in recent months after a torrid start.
The dollar index, which measures the U.S. currency
against six other units, was down 0.2% at 97.54.
U.S. stock futures eased with the S&P and Nasdaq futures
both down 0.2%.
The Japanese yen steadied at 147.87 per U.S.
dollar after strengthening on Friday following the Bank of
Japan's hawkish hold where two board members voted against
keeping interest rates steady.
Oil prices climbed amid heightened geopolitical tensions in
Europe and the Middle East, with Brent crude futures 34
cents higher at $67.02 a barrel. U.S. West Texas Intermediate
futures rose 36 cents to $63.04.
Gold prices climbed, and were last up roughly 1% and at one
point at a fresh record high of $3,719.65 per ounce.