Stocks, dollar drift lower in central bank-packed week

World shares and the U.S. dollar experienced declines, reflecting concerns about global economic growth. Investors were nervous as central banks from various countries were set to hold meetings, including the United States, Japan, Scandinavia, Switzerland, and Britain.

The pan-European STOXX index fell by 0.6%, primarily driven by losses in healthcare, banking, and semiconductor stocks. This decline came as Societe Generale, France’s third-largest listed bank, announced expectations of minimal or no growth in annual sales in its strategic plan, causing its shares to plummet by over 9%.

Concerns persisted about China’s property market, as shares of China Evergrande Group dropped by 25% following the detention of some staff in its wealth management unit. Another property developer, Country Garden, faced liquidity issues, including a deadline to pay $15 million in interest linked to an offshore bond.

In Asia, technology shares faced a setback, with Taiwan’s TSMC, the world’s leading contract chipmaker, declining by 3%. This drop followed reports that TSMC had asked its major suppliers to delay the delivery of high-end chipmaking equipment.

Geopolitical tensions, worker strikes, and uncertainty about China’s international engagement added to concerns about global growth. The disappearance of China’s defense minister raised uncertainty about President Xi Jinping’s stance on international issues.

The possibility of a U.S. government shutdown also loomed, contributing to market apprehension.

The Euro Stoxx Volatility Index indicated growing volatility in world markets, signaling that central banks were at a turning point in monetary policy. TD Securities’ models predicted a potential growth slowdown later in the year, which might prompt central banks to consider rate cuts.