Global stock markets gave up some recent gains yesterday following mixed results from retailers as Wall Street digested Federal Reserve minutes that suggested interest rates could stay high for a while.

Major US indices, which have been on a tear over the last three weeks, spent the entire session in the red.

The minutes, which chronicle discussion surrounding the Fed’s November 1 decision to hold interest rates steady, said policy makers backed a “restrictive stance” in monetary policy “for some time until inflation is clearly moving down sustainably.”

That statement suggests the Fed is in no hurry to cut interest rate – something equity markets have been hoping for.

Still, analysts said yesterday’s retreat was largely due to the sense the market was overbought.

“We’ve seen a sizeable move higher over the last month with impressive gains, so it’s not too surprising to see a pause to digest those gains,” said Angelo Kourkafas of Edward Jones.

“Markets don’t move in a straight line.”

The Dow and S&P 500 both lost 0.2%, while the Nasdaq dropped a bit more at 0.6%.

Several prominent retailers disappointed investors with results or downcast forecasts. 

These included Lowe’s, down 3.1%, Kohl’s, down 8.6%, and American Eagle Outfitters, down 15.8%. Chains that rose after results included Dick’s Sporting Goods, up 2.2% and Burlington Stores, up 20.7%.

The results come ahead of the “Black Friday” kickoff of the holiday shopping season. The National Retail Federation has projected overall holiday sales growth of between three and 4%, which would mark a return to the pre-pandemic trend of more modest increases.

In Europe, London and Paris both retreated somewhat while Frankfurt ended flat.

Asian markets started strongly yesterday but ran out of gas as the day progressed.

Hong Kong dipped even after market heavyweight Alibaba jumped more than 2% to extend its rebound after diving 10% Friday on news it had canceled the spinoff of its cloud computing arm.

Argentina’s stock market reacted with optimism yesterday to the resounding election win by libertarian Javier Milei, despite the country being gripped by uncertainty over what changes the self-described “anarcho-capitalist” will bring.

The rise was led by state oil company YPF whose shares rose more than 30% after the president-elect announced he would privatise it as part of his package of reforms.

Key figures around 2200 GMT

New York - DOW: DOWN 0.2% at 35,088.29 (close)

New York - S&P 500: DOWN 0.2% at 4,538.19 (close)

New York - Nasdaq: DOWN 0.6% at 14,199.98 (close)

London - FTSE 100: DOWN 0.2% at 7,481.99 (close)

Paris - CAC 40: DOWN 0.2% at 7,229.45 (close)

Frankfurt - DAX: FLAT at 15,900.53 (close)

EURO STOXX 50: DOWN 0.2 at 4,331.90 (close)

Tokyo - Nikkei 225: DOWN 0.1% at 33,354.14 (close)

Hong Kong - Hang Seng Index: DOWN 0.3% at 17,733.89 (close)

Shanghai - Composite: FLAT at 3,067.93 (close)

Euro/dollar: DOWN at US$1.0913 from US$1.0940 on Monday

Pound/dollar: UP at US$1.2537 from US$1.2505  

Dollar/yen: DOWN at  ¥148.33 from  ¥148.39 

Euro/pound: DOWN at 87.02 pence from 88.50 pence

Brent North Sea crude: UP 0.2% at US$82.45 per barrel 

West Texas Intermediate: DOWN 0.1% at US$77.77 per barrel – AFP, November 22, 2023.