Stocks Fluctuate as Traders Hesitate on US Rates Forecast: Market Summary

European stocks took a hit as investors scaled back expectations for Federal Reserve policy easing, leading to a retreat from riskier assets. The Stoxx 600 fell 0.2%, with tech and real estate sectors weighing down the index. US futures contracts remained steady after slipping from all-time highs, while the dollar edged higher and Treasuries held firm.

Luxury group Richemont saw a rally after appointing Nicolas Bos as CEO in a management shake-up. The meme-stock craze saw GameStop Corp. and AMC Entertainment rebound after shedding $7 billion over two days. Reddit Inc. shares surged following a content partnership with OpenAI.

Investors showed caution on Friday amid a reevaluation of US rate cut expectations, with only one reduction now expected in 2024. Fed policymakers suggested keeping borrowing costs higher for longer to monitor inflation trends.

Stuart Cole, head macro economist at Equiti Capital, noted that markets are at a crossroads with central banks closely monitoring data. Investors are eagerly awaiting comments from Fed officials Christopher Waller, Neel Kashkari, and Mary Daly for further insights on interest rate trajectories.

Elsewhere, European Central Bank Executive Board member Isabel Schnabel cautioned against consecutive interest rate cuts in June and July. In Asia, equities declined on signs of economic weakness in China, while the yen weakened against the dollar after the Bank of Japan maintained bond buying amounts.

Oil prices were set for a modest weekly gain, and the New York copper market saw a record squeeze ease. Key events to watch this week include ongoing market movements and central bank decisions.