Shares slip on China growth jitters as Fed minutes loom

Global shares fell on Wednesday as fresh signs of China’s faltering economic recovery emerged, with traders awaiting U.S. Federal Reserve minutes and a key U.S. jobs report later in the week for clues to the central bank’s rate outlook.

In quiet trade following the Independence Day holiday on Wall Street on Tuesday, European stocks (.STOXX) slipped 0.6%, with German shares (.GDAXI) down the same amount.

Wall Street was set for losses, too, with S&P 500 futures and Nasdaq futures down 0.2%-0.4%.

The Chinese services sector, which has rebounded strongly since the lifting of COVID-19 lockdowns, expanded at the softest pace in five months in June, a survey showed, adding to signs of a soft recovery in the world’s second-biggest economy.

The release of the minutes of the Fed’s last policy meeting, due later on Wednesday, and the non-farm payrolls report on Friday are top of traders’ agenda this week as they watch to see whether the Fed will need to hike more than once to stem inflation.

“Focus is very much on whether is inflation peaking; has it peaked; how many more rate hikes are coming down the hike?” said Michael Hewson, chief market analyst at CMC Markets.

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