Market Analysis

European and global markets are bracing for another day influenced by tech stocks, as a disappointing forecast from Meta Platforms, the parent company of Facebook, sparked a widespread sell-off across regions.

Meta's announcement of lower revenue projections and increased expenses sent shockwaves through the market, wiping out $200 billion of its market value and dragging down several competitors amid concerns about rising AI costs.

Following suit, Asian tech stocks saw a 2% decline, with significant drops in tech-heavy markets like Taiwan and South Korea. Now, attention turns to European tech stocks as investors await earnings reports from key players like Intel, Alphabet, and Microsoft, which will provide further insights into the AI landscape.

Thursday brings a flurry of earnings reports in Europe, with a particular focus on banking firms such as Deutsche Bank, BNP Paribas, and Barclays. Analysts will scrutinize their net interest margins, especially amidst expectations of falling interest rates in Europe and the UK later in the year.

In Turkey, the central bank is expected to maintain its policy rate at the current 50% level until the fourth quarter, according to a Reuters poll of economists, with the policy decision due later in the day.

Meanwhile, the yen has breached the psychologically significant level of 155 per dollar, raising speculation about possible intervention from Tokyo. However, the absence of commentary from the Ministry of Finance may embolden yen bears, with all eyes now on the Bank of Japan's upcoming policy meeting and Governor Kazuo Ueda's remarks. Ueda is likely to tread cautiously to avoid a repeat of the 2022 episode, where dovish remarks from his predecessor triggered a yen plunge and forced Tokyo to intervene at a substantial cost.

Paraphrasing text from "Investing" all rights reserved by the original author.