Global Markets Open 2018 with Divergent Trends

Global stock markets opened 2018 with mixed results, as euro and pound strength weighed on European indices while Wall Street and Asia advanced. The eurozone and London exchanges recorded declines due to rising currency values against the dollar, impacting export-focused companies.

Signs of subdued US inflation prompted dollar weakness, suggesting the Federal Reserve might delay rate hikes in 2018. This could enable other central banks to accelerate their own monetary tightening efforts.

AxiTrader's James Hughes noted the US dollar dominated early 2018 trading, while Spreadex analyst Connor Campbell highlighted profit-taking in European markets driven by weak dollar conditions and minimal impact from manufacturing data.

Greg McKenna, AxiTrader's chief market strategist, predicted the euro would rise as traders anticipated the European Central Bank following the Federal Reserve's path toward ending quantitative easing and initiating rate hikes.