Global markets under inflation pressure

ISTANBUL

Global markets opened this week feeling the pressure from recent developments in global inflation and mixed macroeconomic signals from Asian economies.

While the world markets were mostly positive last week, New York stock exchange performed negatively due to the inflation stress.

Analysts expect inflation concerns will affect markets this week, while investors will follow an expected meeting between the US and Chinese presidents.

On Monday, the Japanese economy contracted by 3% year-on-year, faster than expected, while the island nation's industrial production and capacity utilization rates also posted negative results.

In China, retail sales and industrial production increased by 4.9% and 3.5% in October.

On Monday, the new Chinese stock exchange market, Pekin, started transactions with 81 companies' shares. The new exchange market is expected to focus on technology, internet and services sectors.

On the US side, statements related to inflation concerns continue.

Neel Kashkari, the head of Minneapolis Fed, said inflation was a temporary concern for a couple of months. Janet Yellen, the treasury secretary, said the best way to decrease prices is fighting the pandemic.

Analysts forecast that US Fed officials may direct markets through speeches against inflationary concerns.

Ten-year US bond yields closed last week at 1.5760 by increasing 13 basis points, while it rebalanced at 1.5600 at the new week.

The price of Brent oil continued the three-week downward trend this week.

Analysts on Monday will watch the Euro area foreign trade figures and the US Fed's industry index data.

* Writing by Gokhan Ergocun