Equity markets ease after four-week rally; Fed meeting eyed
By Chuck Mikolajczak
NEW YORK (Reuters) - Global equity markets slipped on Monday, pausing after a four-week rally ahead of policy announcements from central banks in the United States and Japan later in the week, while the dollar weakened in the wake of soft U.S. housing data.
Stock markets rallied last week on the potential that Japan's already-massive stimulus would be further increased after China cut interest rates last week and the European Central Bank indicated it may add to its asset purchase program in December.
But comments Monday by a key economic adviser to Prime Minister Shinzo Abe, who said the Bank of Japan did not need to boost its monetary stimulus this week, tamped down those expectations somewhat.
The U.S. Federal Reserve, meanwhile, will issue a policy statement at the conclusion of a two-day meeting on Wednesday. It is increasingly expected to hold off its first rate hike in nearly a decade until next year.
U.S. stocks dipped, with the PHLX housing index down 0.4 percent after the Commerce Department said new U.S. single-family home sales fell to near a one-year low in September after two straight months of gains.
"I kind of expected it to be stuck in neutral," said Randy Frederick, managing director of trading and derivatives for Charles Schwab in Austin, Texas.
"People are just sitting tight waiting for the Fed meeting, although frankly it is going to be a non-event. That doesn’t mean people won’t get a little concerned about it."